Iran calls blast scare US 'psychological warfare'

Iran has said the scare over yesterday's blast near its only nuclear reactor was engineered by Washington as part of "psychological…

Iran has said the scare over yesterday's blast near its only nuclear reactor was engineered by Washington as part of "psychological warfare" against Tehran and its nuclear programme.

Iranian television unnerved world markets yesterday when it reported an explosion and cited witnesses saying it may have been caused by a plane firing a missile.

The report raised fears of a strike by Israel or the United States, which accuses Tehran of secretly developing nuclear arms.

Washington denied any knowledge of the explosion. The Al-Alam station, broadcasting in Arabic, later dropped the reference to the missile and said a fuel tank might have fallen from a plane.

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After oil markets recovered and the US stock market briefly dropped, Iranian officials quelled concern by announcing the blast was linked to construction of a dam.

Iran's Chief nuclear negotiator, Hassan Rohani, saw a calculated campaign by the United States and the Western media which acted on the Al-Alam report.

"This fuss over an explosion shows that they use any excuse to attract attention towards Iran's nuclear programme," Mr Rohani told state television. "Reports of a strike were false and are psychological warfare."

The explosion was reported near the town of Dailam 100 miles from the Russian-built Bushehr nuclear plant.