By Michael R. Gordon in Washington and Sune Engel Rasmussen in Vienna

Iran will start enriching some of its stock of uranium to 60% for the first time, one of Iran's leading nuclear negotiators said Tuesday, after an attack on its main nuclear facility.

But the country's negotiators will continue to participate in talks in Vienna on constraining its nuclear activities in return for a reversal of American economic sanctions on Tehran. Former U.S. officials said that Iran's announcement appeared to be calculated to fortify Iran's negotiating hand and counter the notion that its nuclear program had suffered a major setback.

The comments from Abbas Araghchi, a deputy foreign minister, followed the apparent sabotage of Iran's Natanz nuclear facility Sunday, which caused an electrical blackout that destroyed a number of centrifuges. Israeli media reported that the attack was carried out by the nation's Mossad intelligence agency, though Israeli officials declined to comment. Iran has also blamed Israel. The White House has said the U.S. had no involvement in the Natanz attack.

"The Iranians believe their nuclear activity provides leverage in the talks," said Gary Samore, director of the Crown Center for Middle East Studies at Brandeis University and a weapons-of-mass-destruction expert on former President Barack Obama's National Security Council. "Since some portion of Natanz appears to have been knocked out for some period, that weakens their leverage, and they have compensated by announcing higher enrichment levels."

Mr. Araghchi was in the Austrian capital to attend a second week of negotiations over restoring the 2015 nuclear deal by bringing Iran back into compliance and by removing sanctions that the U.S. imposed after the Trump administration withdrew from the pact in 2018.

Engaged in the talks are all remaining participants in the pact -- Iran, Russia, China, France, Germany and Britain. The U.S. is participating without meeting directly with Iranian officials.

Since the Trump administration's 2018 withdrawal, Iran has abandoned some of its commitments under the deal and resumed some nuclear activities that breach its limits. Iran maintains its nuclear program is for peaceful energy applications. On Tuesday, the U.S. said U.S. intelligence assessed Iran wasn't currently undertaking "key nuclear-weapons-development activities" necessary to produce a nuclear weapon.

In January, Iran raised its levels of uranium enrichment to 20% purity for the first time since 2013, well beyond the limits of the 2015 deal, which is known as the Joint Comprehensive Plan of Action, or JCPOA. By producing uranium enriched to 60%, Iran would move closer than ever before to the 90% purity threshold required for weapons-grade uranium.

Iran's ambassador to the United Nations atomic agency, Kazem Gharibabadi, said late Tuesday that he expected the first 60% material to be produced next week. The Iranians will use two cascades of centrifuges at the above-ground pilot project at Natanz, signaling that production of 60% material is likely to be limited. One nuclear expert involved in the talks said he expected Iran's output of the material at first to be "very low."

Reaching 60% enriched uranium would be Iran's most dramatic breach of the 2015 accord yet -- and uncharted territory for Iranian scientists and engineers. Iran says all its breaches of the deal's limits so far are reversible if the U.S. lifts sanctions, which have hit Iran's economy. However, Western officials worry that in the process of advancing its nuclear program, Iran may gain technical knowledge that can't be erased, even if its enrichment levels are lowered and centrifuges stowed away.

"The big risk in gaining knowledge is not so much with the 60% per se, but with Iran's expanded use of advanced centrifuges," said Eric Brewer, a former National Security Council counterproliferation official, now at the nonpartisan Center for Strategic and International Studies research organization in Washington.

While all sides say they are intent on reviving the nuclear deal, if the Vienna talks collapse or reach deadlock, Iran could try in that time to push its nuclear program to a more sophisticated level than it was in 2013, when it agreed to curb the program under an interim deal before the 2015 agreement. That, in turn, could spur Israel to undertake new operations to try to thwart Iran's progress.

In November, Iran's top nuclear scientist was shot and killed in an attack Iran blamed on Israel. Israel declined to comment. In July, an explosion damaged a building at the Natanz site. Israel has also targeted at least a dozen vessels bound for Syria and mostly carrying Iranian oil.

Experts have said Iran's current stockpile stands at around three tons of less-enriched material, enough for two nuclear weapons once refined to higher purity.

The head of Iran's atomic energy agency, Ali Akbar Salehi, said more sophisticated centrifuges would soon replace the ones destroyed in the attack on Natanz, and that electrical power systems would be quickly restored in the coming days. Backup power is already online. IAEA inspectors are expected to visit Natanz on Wednesday, according to a senior diplomat.

"Every single centrifuge is being checked, and damaged centrifuges will be replaced," Iranian state television reported him as saying. "We will definitely move towards 60% enrichment."

The IAEA reported on April 1 that Iran had already installed close to 800 advanced centrifuges at Natanz, which can produce enriched uranium at an estimated five times faster than the less sophisticated centrifuges that make up the bulk of its hardware.

It could take several months to install the 1,000 additional advanced machines that Iran says it will install, experts say.

--Aresu Eqbali in Tehran and Laurence Norman in Brussels contributed to this article.

Write to Michael R. Gordon at michael.gordon@wsj.com and Sune Engel Rasmussen at sune.rasmussen@wsj.com

(END) Dow Jones Newswires

04-13-21 1758ET