President Obama intends to press ahead with efforts to open a dialogue with Iran despite an apparent setback yesterday when Ayatollah Ali Khamenei, the country’s supreme religious leader, dismissed U.S. overtures as a “slogan” offering no real change.

Obama and his aides had already been considering a direct approach to Khamenei as a possible follow-up to the president's unprecedented video address to the Iranian people, released on Friday.

Khamenei’s initial response was not encouraging, but U.S. officials and European diplomats noted that the Iranian leader did not rule out a future breakthrough. A familiar chant of “Death to America” echoed around a religious shrine in the northeastern city of Mashhad as Khamenei complained that Obama had “insulted the Islamic republic of Iran from the first day."

He added: “If you are right that change has come, where is that change? Make it clear for us what has changed.”

His remarks came as a nuclear powered U.S. submarine — the USS Hartford — collided at sea with an amphibious vessel, the USS New Orleans, off the Straits of Hormuz. Fifteen sailors were injured, but the submarine’s atomic propulsion system was undamaged.

The Iranian leader's comments followed a striking attempt by Obama to break the deadlock with the country. The president marked the beginning of the Persian new year with conciliatory remarks intended to establish a new commitment to diplomacy after years of bellicose exchanges between Tehran and the administration of former President George W. Bush.

In the video — subtitled in Farsi — Obama pledged to pursue “constructive ties." The president noted that the process would “not be advanced by threats," and referred to Iran as an “Islamic republic," signalling his readiness to deal with the current religious leadership.

Click here to read more on this story from the Sunday Times of London.