VIENNA/DUBAI (Reuters) – The U.N. nuclear watchdog’s board of governors declared Iran in breach of its non-proliferation obligations on Thursday and Tehran announced counter-measures, as an Iranian official said a “friendly country” had warned it of a potential Israeli attack.

U.S. and Iranian officials will hold a sixth round of talks on Tehran’s accelerating uranium enrichment program in Oman on Sunday, the Omani foreign minister said on Thursday.

But security fears have risen since U.S. President Donald Trump said on Wednesday American personnel were being moved out of the region because “it could be a dangerous place” and that Tehran would not be allowed to develop a nuclear weapon.

Security in the Middle East has already been destabilized by spillover effects of the Gaza war between Israel and Palestinian militant group Hamas.

Trump has threatened to bomb Iran if the nuclear talks do not progress, and has said he has become less confident that Tehran will agree to stop enriching uranium. The Islamic Republic wants a lifting of U.S. sanctions imposed on it since 2018.

Iranian President Masoud Pezeshkian said that even if the country’s nuclear facilities were destroyed by bombs they would be rebuilt, state media reported.

The International Atomic Energy Agency’s policy-making Board of Governors declared Iran in breach of its non-proliferation obligations for the first time in almost 20 years, raising the prospect of reporting it to the U.N. Security Council.

The step is the culmination of stand-offs between the IAEA and Iran since Trump pulled the U.S. out of a nuclear deal between Tehran and major powers in 2018 during his first term, after which that accord unraveled.

An IAEA official said Iran had responded by informing the U.N. watchdog that it plans to open a third uranium enrichment plant.

After the IAEA decision, the Israeli Foreign Ministry said Tehran’s actions undermined the global Non-Proliferation Treaty and posed an imminent threat to regional and international security and stability.

Iran is a signatory to the NPT. Israel is not and is believed to have the Middle East’s sole nuclear arsenal.

Israeli Strategic Affairs Minister Ron Dermer and Mossad head David Barnea will go to Oman to meet U.S. Special Envoy Steve Witkoff before the U.S.-Iran talks in another attempt to clarify Israel’s position, Israeli media reported.

Speaking after meeting European foreign ministers in Rome, European Union foreign policy chief Kaja Kallas said the EU’s concerns with Iran go beyond the nuclear issue, and include its support for Russia and the detention of EU citizens in Iran.

Market Reaction

Oil prices initially rose after Trump’s announcement but later eased. Shares in European airlines, travel companies and hotel chains were among the biggest fallers in morning trade as investors worried the tensions would knock demand.

“Clearly it is Iran that is at the center of this and the possibility that you see a strike from the U.S. or Israel,” said Paul McNamara, a director of emerging market debt for investment firm GAM. “There is a lot of scope for things to get a whole lot worse if we do see a military strike and a sustained attack.”

Foreign energy companies were continuing operations as usual, a senior Iraqi official overseeing operations in southern oilfields told Reuters.

The Dubai-based Emirates airline said it had made no changes to operations, but was monitoring the situation.

Iran’s response to the IAEA resolution was among several countermeasures being taken, Iranian state TV said.

The IAEA official said Tehran had given no further details on the planned new enrichment site, such as its location to enable monitoring by U.N. nuclear inspectors.

Behrouz Kamalvandi, spokesperson for Iran’s atomic energy organization, told state TV that Tehran had informed the IAEA of two countermeasures including “the upgrading of centrifuges in Fordow (enrichment plant) from first to sixth generation, which will significantly boost the production of enriched uranium”.

Enrichment can be used to produce uranium for reactor fuel or, at higher levels of refinement, for atomic bombs. Iran says its nuclear energy program is only for peaceful purposes.

A senior Iranian official told Reuters that rising Middle East tensions served to “influence Tehran to change its position about its nuclear rights”.

Potential Israeli Strike

The Iranian official said a “friendly” country had alerted Tehran to a potential strike on its nuclear sites by Israel.

Iranian state media reported that Iran’s military had begun drills earlier than planned to focus on “enemy movements”.

Iranian retaliation for any Israeli attack will be “more forceful and destructive” than in the past, Revolutionary Guards commander Hossein Salami told state media.

Iran fired a barrage of missiles at Israel last year after Israeli forces bombed Tehran’s consulate in Damascus. Israel replied with missile strikes in Iran and Syria – the first such direct attacks between the region’s most entrenched enemies.

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(Additional reporting by Yousef Saba and Dubai newsroom, Marc Jones in London and GV De Clercq in Rome; writing by Timothy Heritage and Michael Georgy; editing by Mark Heinrich)