President Mahmoud Ahmadinejad's office said, in a statement late on Saturday, that he had never had an interview, either oral or written, with the Gulf newspaper The Khaleej Times.

However, in a statement issued on Sunday, the Dubai-based publication said it stood by the contents of the interview and by the reporter, who is a freelance journalist.

Papers stands by story

The newspaper acknowledged confusion might have arisen because the reporter, on several occasions, presented herself to Ahmadinejad as a reporter with the American-based Arabic News, and not as a Khaleej Times reporter, though she submitted the article exclusively to The Khaleej Times.

The paper's editor, Prem Chandran, said his paper stood behind the interview and the reporter.

"We support what we published, and the reporter has freelanced for us for more than a year. This interview was given to us exclusively," he said.

"Such a claim is nothing more than a mere fabrication"

Iranian president's office

The paper had reported Ahmadinejad as speaking about last month's resolution by the International Atomic Energy Agency (IAEA), which warned Iran it would be referred to the UN Security Council unless it allayed fears about its nuclear programme.

"If Iran's case is sent to the Security Council, we will respond by many ways, for example, by holding back on oil sales or limiting inspections of our nuclear facilities," Ahmadinejad said, according to The Khaleej Times.

Fabrication

The president's office denied this, saying: "Such a claim is nothing more than a mere fabrication," according to the official Islamic Republic News Agency.

Iran pumps about four million barrels daily, making it the second-largest producer in the Organisation of Petroleum Exporting Countries after Saudi Arabia.

If Iran were to curtail its exports by a substantial amount, it would raise the price of oil on the world market. But it would also reduce Iran's revenue.

Iran has made other threats since the IAEA resolution. Officials have threatened to resume uranium enrichment and to block UN inspections of its nuclear facilities unless the UN nuclear agency stepped back.

Iran has also threatened to use trade to punish countries that voted for the resolution, and last week the parliament began debating a bill to force the government to scale back IAEA cooperation.