Racing against the clock, nuclear talks between Iran and six world powers appeared tough going Thursday with both sides warning of major differences as they tried to draft an accord.

The hoped-for agreement would see Iran scale back its nuclear programme, in order to ease fears Iran wants atomic weapons, and avert a conflict in the Middle East.

Iran, which has seen its relations with the West thaw somewhat since the 2013 election of President Hassan Rouhani, wants painful UN and Western sanctions lifted. It denies wanting the bomb.

On a fourth day of talks in Vienna, Iran and the five permanent members of the UN Security Council plus Germany have started haggling over the wording of a deal, officials said.

But beyond agreeing a title for the accord, Iranian Foreign Minister Mohammad Javad Zarif said that "fundamental differences" were dividing the two sides.

On Wednesday negotiations "slowly" began to draft the final agreement, "but there are still many differences" over the text, ISNA news agency quoted Zarif as saying from Vienna.

He added that the talks had been "very difficult".

A Western diplomat said that Iran was refusing to budge on most issues and that drafting language in the text on the "complex issues" had not begun.

"It is worrying that there is no evolution on the part of the Iranians on most subjects," the diplomat told AFP on condition of anonymity.

Differences between the two sides on uranium enrichment, the central issue not only in this fifth round of talks but for the past decade, remain "major," the envoy said.

Enrichment is front and centre of Western concerns about Iran's nuclear ambitions, as the process can produce both fuel for nuclear power plants and, when highly purified, the core of an atomic bomb.

The West wants Iran to slash the number of centrifuges, the machines that enrich uranium, from the current 20,000, but Tehran wants to install many more in order, it says, to fuel a future fleet of nuclear plants.

Other thorny issues include the duration of the mooted accord, the pace of any sanctions relief and a reactor being built at Arak that might give Iran plutonium, the alternative to highly-enriched uranium for a bomb.

"Bearing in mind the limited time that is left and the differences remaining, the progress is slow" in writing the draft, a senior Iranian diplomat at the talks told ISNA.

- No catastrophe -

Iran's top negotiator Abbas Araqchi told IRNA on Wednesday that choosing to push back the July 20 deadline -- when an interim deal struck in November expires -- "won't be a catastrophe".

But US President Barack Obama is not seen as keen, seeking ahead of November midterm US elections to silence accusations that the talks are merely giving Iran time to inch ever closer to the bomb.

Complicating the process is the shared interest of Washington and Shiite Iran in seeing a lightning onslaught by Sunni rebels in Iraq stopped in its tracks.

On Monday US and Iranian officials briefly discussed the crisis on the sidelines in Vienna, although Washington said this would not be repeated.

On Wednesday a senior aide to Rouhani, his chief of staff Mohammad Nahavandian, appeared to say that any US-Iranian cooperation in Iraq depended on progress in the nuclear talks.

"If that comes to a final resolution, then there might be opportunities for other issues to be discussed," Nahavandian said in Norway.

In Israel, assumed to have nuclear weapons itself and which has not ruled out bombing Iran, a minister on Thursday expressed fears that the crisis may prompt Washington to make concessions in Vienna.

But US State Department Jen Psaki spokeswoman said Wednesday that any discussion of Iraq would be "entirely separate" from the nuclear negotiations.

"Any effort to connect the two is a nonstarter for the United States," Psaki told reporters.

Tehran, world powers 'begin drafting nuclear deal'
Tehran (AFP) June 18, 2014 - Iran and world powers started drafting Wednesday a comprehensive nuclear agreement but still face many sticking points, Iranian Foreign Minister Mohammad Javad Zarif said.

"Today we have slowly begun to draft the final agreement... but there are still many differences" over the text, ISNA news agency quoted Zarif as saying from Vienna.

"This does not mean we have reached an agreement," said Zarif, according to IRNA news agency.

"Fundamental disagreements" continue to divide Iran and the P5+1 powers -- Britain, China, France, Russia and the United States plus Germany -- he said.

But Zarif said the two sides have agreed on a title for the text, which will be known as the "General Joint Plan of Action."

A new round of negotiations between Iranian diplomats and those of the six powers, which opened Monday in Vienna, had been "very difficult" so far.

The talks, which run through Friday, are aimed at clinching a comprehensive nuclear deal by a July 20 deadline set up by an interim agreement.

Iran's top negotiator Abbas Araqchi earlier told IRNA news agency that Iran hoped to settle all differences with the six powers by the target date.

The main sticking points are the timetable for a full lifting of crippling US and EU sanctions, and the scale to which Iran would be allowed to continue uranium enrichment, he said.

Enrichment is the sensitive process at the centre of Western concerns about Iran's nuclear ambitions, as it can produce both fuel for nuclear power stations and, in highly extended form, the core of an atomic bomb.

The P5+1 want Iran -- which insists its nuclear drive is purely for civilian use -- to drastically reduce its uranium production capacity, and keep only a few hundred centrifuges active.

They want to ensure that Iran's nuclear activities are purely peaceful. In return, Iran wants the removal of international sanctions that have choked its economy.

US Treasury Secretary Jacob Lew said Wednesday Iran's economy remained in a "state of distress" despite limited sanctions relief.

"Iran sanctions are the toughest the world community has imposed on any country, and its economy is suffering a serious blow as a result -- an impact that is not being reversed," Lew said at a meeting in Jerusalem of the Joint Economic Development Group (JEDG).

- 'Still a long way to go' -

In the remarks to IRNA, Araqchi said "it won't be a catastrophe" if the July 20 target date is not met.

"We hope to start work on Wednesday on drafting the text of a final agreement, not the big issues but the general framework and the introduction," Araqchi said.

"There is a still a long way to go before we reach an agreement acceptable to all sides."

An interim deal struck last November led the six powers to release $7 billion from frozen funds in return for a slowdown in Iran's controversial uranium enrichment.

Iran began implementing the November deal in January.

Tehran said Wednesday that successful nuclear talks could lead to co-operation with the US over their shared interest in Iraq -- where Sunni militants have seized large swathes of territory in a lightning offensive.

President Hassan Rouhani's chief of staff Mohammad Nahavandian told reporters in Oslo that the nuclear talks were a "test for confidence building".

"If that comes to a final resolution, then there might be opportunities for other issues to be discussed."