United Nations: The head of the United Nations nuclear watchdog Mohammad Al Baradei was to report to the Security Council on Thursday on whether Iran has stopped enriching uranium.
Here are some of the key questions surrounding sanctions.
What is the UN Security Council's mandate?
The council passed a legally binding resolution on July 31 demanding Iran suspend "all enrichment-related and reprocessing activities including research and development" within 30 days. Iran hid nuclear work from non-proliferation inspectors for 18 years and has since dodged UN probes.
Will Iran comply?
Unlikely. The Islamic Republic insists on its right to enrich nuclear fuel for civilian energy generation, as a party to the Non-Proliferation Treaty (NPT).
What will the council do next?
If Iran remains defiant, the July 31 resolution authorises the council to "adopt appropriate measures" under Article 41 of Chapter 7 of the UN Charter, which refers to commercial or diplomatic sanctions, but excludes military force.
What sanctions would the council consider?
The council would probably focus on "graduated" steps hinging on Iranian responses. It would look first at largely symbolic sanctions such as a visa ban for Iranian officials and a freeze on their assets abroad, as well as a ban on exports to Iran with nuclear applications. Resort to wide-ranging economic embargoes and diplomatic isolation might come only later.
But Moscow and Beijing have baulked at sanctions. They want more effort to reach a diplomatic compromise. Many key European Union states, including Germany, France and Italy, may prove loath to join in tough sanctions that would jeopardise major export contracts with Iran and the flow of Iranian oil.
Military action as a last resort?
The United States and Israel have talked of air strikes on Iranian nuclear sites. But Security Council approval seems out of the question with even major US allies fearing military action would ignite the Middle East and still fail to destroy widely dispersed, well-hidden atomic sites.
How might Iran react to sanctions steps?
Iran could drop out of the NPT as well as speed up enrichment work, curb oil exports to the West and foment violence via proxies in Iraq, Lebanon and Palestinian areas.