The surprise Saturday resignation of Larijani, a conservative who nonetheless harboured significant differences with Ahmadinejad, is the latest development in a series of moves that have seen Ahmadinejad increase his policy influence.

In August, Ahmadinejad reshuffled his economic team, sacking his oil and industry ministers and then accepting the resignation of the central bank head to strengthen his say over economic policy.

Analysts in Iran believe the replacement of Larijani by Ahmadinejad loyalist Saeed Jalili will give the hardline president more influence over nuclear policy at a time of mounting tensions with the West.

"It is a step towards consolidating the camp of Ahmadinejad and shutting the door to any kind of difference," said political analyst Mohhamad Sadegh al-Hosseini.

"It is a prelude to confirming the line-up in the upcoming parliamentary and presidential elections" on March 14, 2008 and in summer 2009, he said.

The conservative news website Tabnak, the new version of the influential Baztab site that was shut down by the government said: "The appointment of Jalili will mean that the secretary of the security council is more in harmony with the government."

Reformist analyst Saeed Leylaz added: "This is a sign of a change of strategy and policy to speed things up and also a sign of increased radicalism."

That Larijani did not see eye-to-eye with Ahmadinejad, at least on how to present Iran's position on the nuclear issue, was no secret, although the differences were never aired in public.

But it was conspicuous that each time Larijani gave a speech or held important talks, Ahmadinejad would try to steal the limelight with a pronouncement of his own on the nuclear programme.

And given that Larijani was a rival candidate in the 2005 presidential elections, it is hardly surprising the men have different ideas, even if in Iranian politics such disagreements are rarely made explicit.

Alex Bigham, head of the London-based Foreign Policy Centre's Iran research programme, said that there were two chief reasons for Larijani's sudden exit.

"One is his longstanding disagreement with Ahmadinejad over how to handle the nuclear dispute with the UN, and the second reason is his own political ambitions," he said.

"Jalili will be pretty hardline, so maybe slightly less inclined to have a tactic of negotiations," he added.

Ahmadinejad, who has packed his government from the start with allies and even close friends, has made a conspicuous move over the past three months to consolidate his power further.

This could be seen in the context of the March parliamentary elections, where reformists are hoping to launch a comeback and which could be decisive in determining the future direction of the country.

Analysts have speculated that Larijani may be seeking to stand in the parliamentary elections and even be eyeing another crack at the presidency.

In August, the president sacked Kazem Vaziri Hamaneh as oil minister and Ali Reza Tahmasebi at industry, in a move was seen by analysts as an attempt to increase his control over economic policy-making.

A month later, Tahmasb Mazaheri replaced Ebrahim Sheibani as central bank governor, fuelling expectations of a bigger government role in monetary policy making.

Despite his demeanour of apparent unshakable confidence, Ahmadinejad's government has been under pressure from reformists and conservatives alike, especially over its handling of the economy.

He has been criticised across the political spectrum in Iran for the country's high inflation and ploughing extra revenues from high crude oil prices into high-spending infrastructure projects.

Criticism has even come from such august sources as judiciary chief Ayatollah Mahmoud Hashemi Shahroudi but the government has repeatedly defended its policies as popular and effective.

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