TEHERAN (AFP) - President Hassan Rouhani said on Tuesday (Nov 5) that Iran would resume uranium enrichment at an underground plant south of Teheran in its latest step back from a troubled 2015 agreement with major powers.

The suspension of all enrichment at the Fordow plant in the mountains near the Shi'ite holy city of Qom was one of the restrictions on its nuclear activities that Iran accepted in return for the lifting of international sanctions.

But Washington's abandonment of the deal in May last year followed by its reimposition of crippling sanctions prompted Iran to begin a phased suspension of its own commitments in May this year.

Rouhani recalled that under the terms of the agreement Iran had retained more than 1,000 centrifuges at the plant which had been running empty since it went into effect.

"Starting from tomorrow (Wednesday), we will begin injecting (uranium hexafluoride) gas at Fordow," Rouhani said in a speech broadcast by state television.

His announcement came a day after tensions flared anew on the 40th anniversary of the US embassy siege and hostage crisis, with thousands in Teheran taking to the streets and Washington imposing fresh sanctions.

Iran said the resumption of enrichment at Fordow would be carried out transparently and witnessed by inspectors from the UN nuclear watchdog, the International Atomic Energy Agency.

But Russia, which has close ties with Iran, expressed concern about the latest move.

"We are monitoring the development of the situation with concern," President Vladimir Putin's spokesman Dmitry Peskov told reporters. "We support the preservation of this deal."

At the same time, Peskov said Moscow understood Teheran's concerns over the "unprecedented and illegal sanctions" imposed by Washington.

The European Union has also voiced concern. An EU spokeswoman said it was becoming "increasingly difficult" to save the accord, which was abandoned by the US in May last year and which Iran has undercut with a series of recent moves to step up its nuclear activities.

The move is the fourth announced by Iran since it began responding to Washington's abandonment of its commitments.

'COMMITTED TO NEGOTIATIONS'

Iran has repeatedly warned the remaining parties to the deal - Britain, China, France, Germany and Russia - that the agreement can only be rescued if they help it circumvent US sanctions.

European governments have strived to come up with a mechanism that would allow foreign firms to continue to do business with Iran without incurring US penalties.

But to Iran's mounting frustration, their efforts have so far failed to have any significant impact.

Rouhani stressed that Iran remained committed to efforts to save the 2015 agreement despite its phased suspension of some of its commitments.

"The fourth phase, like the three previous ones, is reversible," he said. "We are committed to all the behind-the-scenes negotiations we have with some countries for a solution. Over the next two months, we will negotiate more," he added.

Rouhani said Iran wanted to return to a situation in which "we can easily sell our oil, we can easily use our money in banks." If that were achieved, "we will completely go back to the previous situation."

The European Union warned Monday that its continued support for the deal depended on Teheran fulfilling its commitments.

Maja Kocijancic, spokesman for EU diplomatic chief Federica Mogherini, said the bloc "remains committed" to the deal but "our commitment... depends on full compliance by Iran".

"We have continued to urge Iran to reverse such steps without delay and to refrain from other measures that would undermine the nuclear deal."

On July 1, Iran said it had increased its stockpile of enriched uranium to beyond a 300kg maximum set by the deal, and a week later, it announced it had exceeded a 3.67-per cent cap on the purity of its uranium stocks.

On Sept 7, it fired up advanced centrifuges to boost its enriched uranium stockpiles.

On Monday, Iran announced a more than tenfold increase in enriched uranium production as a result of the steps back from the nuclear deal it had already undertaken.

Enriched uranium production has reached 5kg per day, Ali Akbar Salehi, the head of Iran's Atomic Energy Organisation, told reporters. That compares with the level of 450g two months ago.