TEHRAN (Reuters) -- Iranian President Mahmud Ahmadinejad has raised the stakes against Israel by describing the Holocaust as a lie, just as world powers are trying to decide how to deal with the nuclear ambitions of an Iran in political turmoil.
"The pretext [Holocaust] for the creation of the Zionist regime [Israel] is false...It is a lie based on an unprovable and mythical claim," he told worshippers at Tehran University at the end of an annual anti-Israel Quds (Jerusalem) Day rally. "Confronting the Zionist regime is a national and religious duty."
Ahmadinejad's anti-Western speeches and comments on the Holocaust have in the past caused an international outcry and isolated Iran which is at loggerheads with the West over its disputed nuclear program.
The hard-line president warned leaders of Western-allied Arab and Muslim countries about dealing with Israel.
"This regime [Israel] will not last long. Do not tie your fate to it...This regime has no future. Its life has come to an end," he said in a speech broadcast live on state radio.
His fresh comments came ahead of his appearance at the United Nations General Assembly next week and before Tehran attends talks on October 1 with major powers worried about the Islamic republic's nuclear strategy.
Western powers are concerned by what they have called Tehran's defiance and "point-blank refusal" to suspend uranium enrichment and address the issue as demanded by UN Security Council resolutions since 2006.
Instead of directly addressing those demands, Iran handed world powers this month a proposal that spoke generally of talks on political, security, international, and economic issues but was silent on its nuclear program.
Diplomats familiar with the Iranian proposal said it was vague and did not appear to pass "the smell test." Nuclear Program
Ahmadinejad repeated on September 17 that Iran would "never" abandon its disputed nuclear program to appease Western critics.
In an NBC-TV interview, the Iranian leader also did not offer a direct response when asked whether there were any conditions under which Iran would develop a nuclear weapon.
"We don't need nuclear weapons," Ahmadinejad said, speaking through an interpreter. "We do not see any need for such weapons. And the conditions around the world are moving to favor our ideas," he added.
The major powers suspect Iran's uranium enrichment program is a cover for developing nuclear weapons. Iran has repeatedly said it is enriching uranium only to generate electricity, not for fissile bomb material, although it has no nuclear power plants to use low-level enriched uranium.
"If you are talking about the enrichment of uranium for peaceful purposes, this will never be closed down here in Iran," he said.
Next month's major powers talks with Iran offer no clear relief to Israel, which wants world powers to be prepared to penalize Iran's vulnerable energy imports but sees Russia and China blocking any such resolution at the UN Security Council.
The major powers, which include permanent UN Security Council members Britain, China, France, Russia, and the United States as well as Germany, offered Iran trade and diplomatic incentives in 2006 in exchange for halt to uranium enrichment.
They improved the offer last year but retained the demand that Iran suspend uranium enrichment, something Tehran has ruled out as a precondition.
U.S. President Barack Obama, who came into office pledging a policy of engagement toward Iran, has suggested Iran may face harsher international sanctions, possibly targeting its imports of gasoline, if it does not accept good-faith talks by the end of September.
But Russia, which has veto power in the UN Security Council, last week ruled out oil sanctions against Iran.
Iran, the world's fifth-biggest crude producer, is seen as vulnerable to oil sanctions because it imports 40 percent of its gasoline to supply the cheap fuel Iranians see as a birthright.
At home, Ahmadinejad is facing strong opposition which erupted into unrest following his disputed reelection in June.
On September 18, Iranian security forces clashed with supporters
of opposition leader Mir Hossein Musavi and arrested at least 10 of them during annual anti-Israel rallies in central Tehran.
Thousands of supporters of Musavi, wearing green wristbands or shawls, were among crowds marching in the Quds Day rallies.
Iran's June presidential election, which was followed by huge opposition protests, plunged Iran into its worst political crisis in three decades and revealed deepening divisions within its ruling elites.
The opposition leaders say the poll was rigged to secure Ahmadinejad's reelection. The authorities deny it.
Rights groups say thousands of people, including senior pro-reform figures, were arrested after the election, though most have been freed. The opposition says more than 70 people died during street protests after the vote. It contradicts the official death toll of 36 people.