Even though the Iranian Foreign Affairs Ministry’s senior spokesman Hamid Reza Asefi reiterated Tehran's call for a "one-state" solution to the Israeli-Palestinian conflict, but he promptly added that Iran "would not hinder a two-state solution to the crisis if that was what the two sides wanted" was interpreted as a policy change.

The government’s official spokesman, Abdollah Ramezanzadeh also spoke on the same line Wednesday in his weekly press conference, telling journalists that the Iranian government will "respect any decision that the majority of the Palestinians make".

Mr. Habibollah Asgaroladi, the leader of the powerful Islamic Coalition Society, Iran's oldest and most influential conservative party also opened a window, stating that talks with the United States were not "absolutely forbidden, neither is hostility towards the US a duty", he said, adding that Iran would negotiate with the US "if our national interests deem it necessary".

And as a sign that thing were moving on the Iran-Israel tangle, Israel’s Iran-born President Moshe Katzav said that according to information he has, Iran will soon release the 11 Jews who were imprisoned there over three years ago on charges of spying for Israel.

He also said that efforts are being made to find out the fate of 13 other Iranian Jews who were arrested while trying to escape the country, and have not been heard from since.

Iran angrily rejected the EU’s proposal, saying that the Islamic Republic would not bow to any preconditions for expanding ties with Europe.

But earlier this month, European diplomats expressed optimism the talks were on track.

The new shift of Iranian policy towards Israel came the day that another delegation from the 15-nation European Union arrived in the Iranian Capital for the follow up of signing a Trade and Co-operation Agreement (TCA) with Iran.

Pointing out that Iran’s diplomacy, "like any other policies, being domestic or foreign", are decided day by day and without proper studies, Dr. Qasem Sho’leh Sa’di, a scholar and lawyer, said the new trend concerning Israel is the result of the leadership’s fear of being targeted by the United States after it attacks Iraq.

"The decisions we have made on foreign issues are all inadequate and cost the nation a great deal. Remember that Ayatollah (Roohollah) Khomeini had ruled that Israel must be erased from the map of the world and a lot of time and money the regime dedicated to implement this will, but now we are approaching the recognition of the Jewish State. Ayatollah Khomeini had ruled out peace with Iraq, saying we would fight even if the war lasts twenty years, and we ended by accepting a humiliating resolution and Imam drunk his cup of poison after ward. Now that the rulers feel the strength of the Americans and realises that the peril to the regime is imminent, they say they might recognises Israel to appease Washington", he told the Persian service of Radio France Internationale.

"Iranian diplomacy has always shown its capacity to adapt to new realities", the French news agency AFP quoted political analyst Sa’id Leylaz said, especially with its neighbour Iraq apparently next in the firing line of the United States.

According to Mr. Sho’leh Sa’di, President Bush’s placing Iran in the basket of evil states had both "infuriated and frightened" the Iranian clerical rulers.

"The conservatives want to normalise with Washington in order to secure their survival after the fall of Saddam Hoseyn, but they are more concerned not to be over taken in this race by the reformists", a veteran Iranian journalist explained. ENDS IRAN ISRAEL 161002