The Bush administration is committed, for now, to using diplomatic and economic means to counter the potential nuclear threat from Iran, Defense Secretary Robert Gates said Sunday.

Speculation has persisted about preparations for a military strike against Iran for its alleged support for terrorism and its nuclear program.

Gates, in a broadcast interview, said he would not discuss "hypotheticals" about what President Bush "may or may not do."

"I think that the administration believes at this point that continuing to try and deal with the Iranian threat, the Iranian challenge, through diplomatic and economic means is by far the preferable approach. That's the one we are using," the Pentagon chief said.

"We always say all options are on the table, but clearly, the diplomatic and economic approach is the one that we are pursuing," he added.

The diplomatic approach takes center stage at a conference in Washington on Friday. The U.S. hosts the U.N. Security Council's four other permanent members — Britain, China, France, Russia — plus Germany to press for new penalties against oil-rich Iran.

These countries have sought for almost two years to use punishments — actual or threatened — to persuade Tehran to drop disputed nuclear work. Two rounds of mild penalties have not slowed or stopped the activities.

Washington has been the chief proponent of world sanctions against Iran, while Russia, which has trade and military ties to Iran, has proved the most reluctant member of the coalition.

The U.S. contends Iran's nuclear power program is a cover for developing weapons. Tehran insists it wants to master the technology to meet future power needs.

The administration is expected to soon blacklist a unit of Iran's Revolutionary Guard Corps as a terrorist organization, subjecting part of the vast military operation to financial penalties. The step would be in response to Iran's involvement in Iraq and elsewhere.

Last week, the top U.S. commander in Iraq, Gen. David Petraeus, told reporters he had solid evidence, including the explanations of captured Iranian agents, to support his claim that Iran was behind lethal attacks in Iraq. Petraeus warned Congress that the U.S. already was fighting a "proxy war" with Iran.

Gates spoke on "FOX News Sunday."