REUTERS SUMMIT-No sanctions easing at front end of Iran talks -U.S.
* Rhodes: Iran must take 'concrete steps' for sanctions relief
* White House seeks flexibility from Congress to pursue talks
* Access to frozen funds is one way to ease economic pain
WASHINGTON, Oct 24 (Reuters) - The United States is not looking to ease sanctions on Iran "at the front end" of negotiations over the Iranian nuclear program, a senior White House official said on Thursday.
The Islamic republic would have to take "concrete steps" to address its program before Washington could provide sanctions relief, Ben Rhodes, a deputy national security adviser to President Barack Obama, said at the Reuters Washington Summit.
The United States suspects Iran may be using its civilian nuclear program as a cover to develop atomic weapons. Iran denies that, saying its program is solely for peaceful purposes.
Major powers last week held their first formal negotiations with Iran on its nuclear program since the election in June of Iranian President Hassan Rouhani, a relative moderate, opened the door to a possible diplomatic resolution.
Obama has said he will not allow Iran to acquire a nuclear weapon and that all options are on the table for dealing with Iran, code for the possible use of military force.
But he has made clear his preference is a negotiated solution - one that is widely expected to gradually remove economic sanctions that have crippled Iran's economy if Tehran takes steps to demonstrate the peaceful intent of its program.
Sanctions imposed in 2011 by Washington and the European Union have slashed Iran's oil exports by more than 1 million barrels a day, depriving Tehran of billions of dollars of sales a month and driving up inflation and unemployment.
In an hour-long interview, Rhodes said one way to offer Iran sanctions relief would be to give it access to frozen funds. But he said that was simply one possibility among many and that he did not wish to suggest a preferred course had been identified.
The New York Times on Oct. 17 first reported that as a way to ease Iran's economic pain without dismantling sanctions.
Iran's oil exports have been cut in half over the past year as the United States has imposed increasingly tough sanctions because of concerns about its nuclear program, which Washington sees as a direct threat to Israel and to its Gulf Arab allies.
"We are not contemplating anything that removes those sanctions at the front end of any negotiation or agreement, because it's going to be important to test Iranian intentions," Rhodes said.
"Before we could pursue sanctions relief, we'd have to see concrete steps by the Iranians to get at the state of their nuclear program," he added at the summit, held at the Reuters office in Washington.
Rhodes made clear the Obama administration wanted some flexibility from the U.S. Congress to explore such a deal, saying the White House would like lawmakers to consider the progress of negotiations as they contemplate any new sanctions.
The White House hosted a meeting on Thursday of U.S. Senate aides seeking to persuade lawmakers to hold off on a package of tough new sanctions against Iran, a senior Senate aide said.
While Congress has sought harsher sanctions on Iran, the White House wants time to give negotiations a chance. The talks, which include Britain, China, France, Germany, Russia and the United States, are due to resume Nov. 7-8 in Geneva.
"We continue to want to have that flexibility to pursue this diplomatic track. There's an opening that we want to test," Rhodes said.
"That doesn't mean that Congress won't consider new sanctions. It means that as they do, they should take into account the progress we're making on diplomacy, and that we need to have some flexibility to pursue an agreement," he added.
Rhodes held up North Korea, which has tested nuclear devices at least twice, as a cautionary tale for other nations.
"Some people make an argument that North Korea shows that you should just get a nuclear weapon because then you have some type of security guarantee," he said. "I would actually make an opposite argument. ... Would you want to be North Korea today (with a) completely stagnant economy, completely isolated?"
"As we said with Iran, if we were able to resolve this issue they could rejoin the community of nations and could bring significantly more economic opportunity to their citizens," he said. "That would be a preferable position to be in than an isolated, impoverished, pariah state as North Korea is."
"It remains to be seen how the Iranian negotiations play out, but I actually think North Korea is a cautionary tale for nations that may want to pursue a nuclear weapon," he said.
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