TEHRAN, Iran - Iran's president took an unusually soft tone toward the United States yesterday, saying a new U.S. intelligence report marked an opportunity to resolve U.S.-Iranian differences. But he said Washington must take further steps, including dropping nuclear sanctions.

President Mahmoud Ahmadinejad offered little new substance in his comments yesterday - but he avoided the inflammatory rhetoric that he has often used toward Washington. Instead, he held out promise that Iran and the United States could end their numerous disputes.

Ahmadinejad praised the U.S. intelligence report, calling it "a step forward."

"If one or two other steps are taken, the issues we have in front of us will be entirely different and will lose their complexity, and the way will be open for the resolution of basic issues in the region and in dealings between the two sides," Ahmadinejad said.

"A good opportunity is available right now, and that opportunity has to be used well," he said, calling on the West to "change behaviors."

He said one further step by the United States would be to declare that "the nuclear issue is terminated," adding that in light of the report there was no need for further sanctions nor "any reason for continuation of hostilities."

The conciliatory line appeared aimed at deflecting Washington's attempts to win further sanctions against Iran and bringing the United States into negotiations after a recent U.S. intelligence report found that Tehran halted work on a nuclear-weapons program four years ago.

Ahmadinejad might also be trying to fend off critics at home who have accused him of provoking Iran's enemies with his fiery rhetoric. Ahead of Ahmadinejad's news conference, one of his top critics - Hasan Rowhani, a former nuclear negotiator and a powerful figure in Iran's leadership - made his harshest criticism yet of the president, saying his government had failed on foreign policy.

The United States brushed off Ahmadinejad's comments, saying Iran must abide by U.N. demands that it suspend uranium enrichment.

"We totally agree with the Iranian president," said Gordon Johndroe, a spokesman for the National Security Council. "One or two more steps are needed. Let's start with Iran suspending its uranium-enrichment process."

Yesterday, diplomats from the United States, Russia, China, Britain, France and Germany held a 90-minute conference call to discuss a draft plan for new sanctions, but State Department spokesman Sean McCormack said it was still too early to talk about an agreement.

President Bush insisted that "Iran is dangerous," pointing to the report's conclusion that Tehran once was seeking a nuclear weapon.

In an interview with ABC News, Bush said Iran "had a hidden program that was a military program," adding: "We think you have shut it down now. You have an obligation to explain to the world loud and clear why you had a military program. Do you intend to start it up again. In other words, the ball is in their court."

Gary Sick, professor of international affairs at Columbia University and a former adviser to the U.S. National Security Council, said that although Ahmadinejad appeared to be dropping his usual confrontational tone, it was difficult to gauge his intentions.

"This does appear to be a departure from his usual line," Sick said. "Ahmadinejad believes that he is in fact promoting an opening to the U.S. and actually promoting some kind of reconciliation."

Vali Nasr, a professor at the Fletcher School of Law and Diplomacy at Tufts University, said Ahmadinejad was betting that Washington would have to take a more moderate stance in light of the new intelligence.

Answering NIE, Olmert Says Iran Still a Threat

Israeli Prime Minister

Ehud Olmert yesterday delivered a fierce rebuttal to a U.S. intelligence assessment that Iran has halted its nuclear weapons, saying Tehran still posed a major threat to the West and the world must not let down its guard.

"Iran was

and remains dangerous," Olmert said, "and we must continue international pressure with full force to dissuade Iran from nuclear tendencies." It was Olmert's first public comment on Iran since the U.S. report was released last week.

In Tel Aviv

, Olmert said: "Iran continues its activities to attain two vital components to create nuclear weapons: the development of a sophisticated electrical system and ballistic missiles, while at the same time producing enriched uranium."

- Associated Press