Democratic presidential candidate Barack Obama on Friday blamed Bush administration failings in Iraq for strengthening the strategic position of Iran, which he says must be stopped from acquiring nuclear weapons.

The Illinois senator said that means "direct engagement" with Iran similar to the meetings with the Soviet Union at the height of the Cold War.

"One of the most profound consequences of the administration's failed strategy in Iraq has been to strengthen Iran's strategic position; reduce U.S. credibility and influence in the region; and place Israel and other nations friendly to the United States in greater peril," Obama told the American Israel Public Affairs Committee, the pro-Israel lobbying group.

The Bush administration recently altered its position, with Secretary of State Condoleezza Rice saying this week that the U.S. is willing to talk to Iran on security in Iraq.

Obama also emphasized in his speech his commitment to protecting the security of Israel, which he called "our strongest ally in the region and its only established democracy."

"Our job is to renew the United States' efforts to ... help Israel achieve peace with its neighbors while remaining vigilant against those who do not share that vision," Obama said.

The speech was the second time in recent months that Obama has formally addressed foreign policy in his hometown of Chicago. In November, Obama called for a reduction of U.S. forces in Iraq at the Chicago Council on Global Affairs.

But Obama focused on Iran Friday, calling President Mahmoud Ahmadinejad's regime "a threat to all of us."

A member of the Senate Foreign Relations Committee, Obama said the world — not just the United States — must stop Iran's uranium enrichment program.

"While we should take no option, including military action, off the table, sustained and aggressive diplomacy combined with tough sanctions should be our primary means to prevent Iran from building nuclear weapons," Obama said.

Obama said Iranian nuclear weapons would destabilize the region and could set off a new arms race.

Fellow senator and Democratic rival Hillary Rodham Clinton has warned Bush not to take any military action against Iran without congressional approval.

Iran has refused to freeze its enrichment-related activities and the U.N. Security Council has imposed sanctions targeting its nuclear and missile programs and persons involved in them.

Iran has refused to halt its nuclear program, contending it is to provide energy — not weapons — for the country.