Vienna: The UN nuclear atomic energy agency said for the first time that Iran is suspected of conducting secret experiments whose sole purpose is the development of nuclear arms.

The report is the strongest sign yet that Iran seeks to build a nuclear arsenal, despite claims to the contrary. With Israel threatening a military response, the report opens the way for a new confrontation between the West and Iran.

In its latest report on Iran, the International Atomic Energy Agency (IAEA) outlines the sum of its knowledge on the Islamic Republic's alleged secret nuclear weapons work, including: Clandestine procurement of equipment and design information needed to make such arms; High explosives testing and detonator development to set off a nuclear charge; Computer modeling of a core of a nuclear warhead; Preparatory work for a nuclear weapons test, and Developing and mounting a nuclear payload onto its Shahab 3 intermediate range missile, a weapon that can reach Israel, Iran's arch foe.

Israeli government spokesman Mark Regev said there is a government directive not to comment until Israel has studied the report in depth.

But ahead of the report's release, Israeli Defense Minister Ehud Barak warned of a possible Israeli military strike against Iran's nuclear program.

He said that he did not expect any new UN  sanctions on Tehran to persuade it to stop its nuclear defiance, adding: We continue to recommend to our friends in the world and to ourselves, not to take any option off the table."

The "all options on the table" phrase is often used by Israeli politicians to mean a military assault, and Israeli government members have engaged in increased saber rattling recently suggesting that an attack was likely a more effective way to stop Iran's nuclear program than continued diplomacy.

Iran's official news agency dismissed the IAEA report, saying it "repeats the past claims by the US and the Zionist regime, what was rejected in the past report of the agency.

"The head of the agency has included worthless comments and pictures provided by the intelligence services in the report,” stated the news agency.  It said past inspections by the agency proved what was mentioned as a large steel container, which the IAEA believes is used for nuclear arms-related high explosives tests, were only "metal-constructed toilets."

In Moscow, Russia's Foreign Ministry said it would not comment on the report until it had time to study it. "Time is needed to study it carefully," the ministry said in a statement issued shortly before the IAEA report was released.

"The analysis should be carried out in a calm atmosphere because it is important to figure out whether there really are new, and indeed trustworthy, facts that confirm the suspicions that there are military components in the Iranian nuclear program, or whether we're talking about the intentional and counterproductive exacerbation of emotions," the ministry said.