Iran dismisses reports of U.S. plans for military action as "psychological warfare"

Iran shrugged off reports that the United States is drawing backup plans for military action, saying Monday they were an attempt to scare it into halting its nuclear ambitions but warning that any attack would bring a "suitable response."

A top EU official rejected any use of force against Iran in the confrontation over its nuclear program. But Javier Solana, the EU foreign policy chief, recommended that the 23-nation bloc consider sanctions against Tehran raising the possibility of international punishment for Iran even if the U.S. and Europe cannot win United Nations sanctions.

Several reports published over the weekend in American newspapers said the Bush administration was studying options for military strikes against Iran to stop its nuclear program. An account in The New Yorker magazine said U.S. officials were looking at the possibility of using nuclear bombs against Iran's underground nuclear sites.

U.S. President George W. Bush said Monday the reports were "wild speculation" and said his vow to prevent Iran from developing nuclear weapons "doesn't mean force necessarily. In this case it means diplomacy."

But the White House was not ruling out a military response and said "normal defense and intelligence planning" is under way.

Tehran insists its nuclear program aims to develop energy, denying U.S. and Western accusations that it intends to build weapons. Iran has rejected a U.N. Security Council demand that it end uranium enrichment, a key process that can develop either fuel for a reactor or the material needed for a warhead.

In a speech on Monday, Iranian President Mahmoud Ahmadinejad promised to announce "good nuclear news" in the next five days.

He did not elaborate, but he could be hinting that Iranian scientists have achieved progress in testing the centrifuges used in uranium enrichment, a complex process that Iran has been researching but so far has not said it has perfected, reports AP.

O.Ch.