By Najmeh Bozorgmehr in Tehran

Ali Larijani, Iran’s new parliamentary speaker, on Wednesday warned Europe that imposing tighter sanctions immediately after offering incentives could merely provoke Tehran and instead urged world powers to send more positive signals.

Mr Larijani, a rival of Mahmoud Ahmadi-Nejad, the hardline president, expressed his frustration with the European Union’s decision this week to impose sanctions on Bank Melli, Iran’s largest bank, while speaking in parliament.

He said it undermined incentives presented by Javier Solana, EU foreign policy chief, designed to encourage Iran to halt uranium enrichment.

Mr Larijani’s words could raise alarm in the west. During the past year had come to be seen as a moderate among Iran’s conservatives.

But the speaker warned that comments last week by Mohamed ElBaradei, head of the International Atomic Energy Agency, the United Nations’ nuclear watchdog, should be taken seriously. Mr ElBaradei said a military attack on Iran would pro voke a “ball of fire” in the Middle East and prompt it to produce a nuclear weapon.

“I recommend that you take Mr ElBaradei’s warnings seriously and do not provoke Iran, in which case you will face a [fait accompli] that will block return to the path of interaction,” Mr Larijani said. “Do not increase your costs by miscalculations.”

Mr Larijani, a former senior nuclear negotiator, did not specify which of Mr ElBaradei’s words he was referring to, but the ambiguity could be interpreted as a warning that Tehran would seek to develop a nuclear bomb if threatened.

Iran argues its nuclear programme is for peaceful energy production.

The speech comes amid rising speculation that Israel is planning an attack on Iran’s nuclear facilities. An Israeli cabinet minister recently said a strike might be unavoidable if uranium enrichment was not halted. Israeli military manoeuvres this month in the eastern Mediterranean were interpreted by US officials as a message to Iran.

Mr Larijani did not refer to recent military threats that he previously described as psychological war, but his statements are a message to the world that Iranians will be united if international pressure intensifies.