President Bush said Tuesday that he's deeply suspicious about Iran's nuclear ambitions, but that the country's new leader has indicated a willingness to negotiate.

Bush said he got word Tuesday that the newly elected president of Iran, Mahmoud Ahmadinejad (search), said he is willing to work with other nations amid concerns that his country is developing nuclear weapons.

"Just as I was walking in here, I received word that the new Iranian president said he was willing to get back to the table," Bush told reporters at a brief question-and-answer session at his Texas ranch.

"If he did say that, I think that's a positive sign that the Iranians are getting a message, that it's not just the United States that's worried about their nuclear programs, but the Europeans are serious in calling the Iranians to account and negotiating," he said.

Bush said that if Iran does not cooperate, United Nations sanctions are "a potential consequence."

"We'll work with our friends on steps forward, on ways to deal with the Iranians if they so choose to ignore the demands of the world," he said.

In Washington, Defense Secretary Donald H. Rumsfeld (search) again called Iran "notably unhelpful" in U.S.-led efforts to pacify Iraq. He said some conventional weapons from Iran were reaching insurgents in Iraq, but suggested it was unclear whether elements of the Iranian government played a role in supplying them.

"It is true that weapons, clearly, unambiguously from Iran, have been found in Iraq," Rumsfeld said at a Pentagon press conference. "It's notably unhelpful for the Iranians to be allowing weapons of those types to be crossing the border."

Bush's comments came a day after Tehran restarted some uranium conversion activities at its nuclear plant at the central Iranian city of Isfahan (search).

Britain, France and Germany have been trying to persuade Iran to drop its uranium enrichment program and related activities in return for incentives. Tehran rejected their latest offer last weekend.

"We're very deeply suspicious of their desires and call upon our friends in Europe, what's called the E.U.-3 -- Germany, France and Great Britain -- to lead the diplomatic effort to convince the Iranians to give up their nuclear ambitions," Bush said after a meeting with his economic advisers.

Tehran, which had agreed to suspend nuclear activities in November, insists its nuclear program is peaceful, but Washington accuses it of covertly trying to build a weapon.

Iran had pledged to stop building centrifuges, which can be used to enrich uranium to levels high enough to fuel a nuclear weapon. Centrifuges also can be used for the peaceful generation of nuclear energy; uranium enriched to lower levels is used to produce electricity.

Iranian dissident Alireza Jafarzadeh (search), who helped uncover nearly two decades of covert nuclear activity in 2002, told The Associated Press Tuesday that Tehran has secretly manufactured about 4,000 centrifuges capable of enriching uranium to weapons grade. The International Atomic Energy Agency (search) previously had said it was aware of the existence of 164 centrifuges.

Bush spoke shortly after the United Nations' nuclear watchdog agency met in Austria to assess Iran's activities. Diplomats there said the IAEA's 35-nation board of governors was likely to issue a resolution by Thursday urging Tehran to again suspend its nuclear activities.

"If the Iranians continue to balk, we'll work with the E.U.-3," Bush said. "In other words, they're the lead negotiators on behalf of the free world. And we will work with them in terms of what consequences there may be, and certainly the United Nations is a potential consequence."