"The inspectors were able to visit Arak last week," the diplomat told AFP on condition of anonymity. "It was the first time that they had been authorised to do so for a year."

IAEA spokesman Ayhan Evrensel refused to comment on the matter.

Tehran had also allowed the UN nuclear weapons watchdog to step up surveillance of another key site at Natanz, said the diplomat.

"The containment and surveillance measures were updated as the agency wanted," said the source.

Agency officials had been anxious to improve its video surveillance to take account of the expansion of the site.

The site at Arak, with its nearly completed 40-megawatt reactor, is one of most sensitive nuclear sites in Iran, as it could produce plutonium, which Iran says would be for medical research.

While the West and Israel suspect Iran of secretly trying to build nuclear weapons, Tehran insists its atomic programme is for energy generation.

IAEA director Mohamed ElBaradei has persistently called for his agency's inspectors to be allowed back into Iran to continue their checks.

ElBaradei will publish his latest report on Iran next week and it will go before the agency's governors in September.

Israel however has accused the IAEA of holding back incriminating evidence of Iran's drive to obtain nuclear weapons, according to a report in the Haaretz newspaper Wednesday.

It cited unnamed Israeli officials as saying the agency had held back from publishing data obtained in recent months that indicated Iran was pursuing information about military applications for its nuclear programme.

ElBaradei, who steps down in December, has said the UN watchdog has no such evidence.

Iran has defied repeated UN Security Council calls to halt uranium enrichment, the process which makes nuclear fuel but also the core of an atomic bomb.

But on Tuesday, Iran's envoy to the International Atomic Energy Agency, Ali Asghar Soltanieh, said Tehran was ready to hold talks with the West on its atomic drive "without preconditions," state television reported.

According to an IAEA report on Iran leaked in June, the Islamic republic is still defying the UN Security Council and has so far amassed 1,339 (2,946 pounds) kilogrammes of low-enriched uranium hexafluoride (UF6).

Estimates vary, but analysts calculate that between 1,000 and 1,700 kilogrammes of low-enriched uranium would be needed to convert it into enough highly-enriched uranium to make a single atomic bomb.

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