UPDATE 2-Iran urges powers to accept nuclear rights in talks

* Powers reluctant, citing past Iranian nuclear secrecy

* Iran, 6 powers to resume talks in Moscow on June 18 (Adds quotes, Israeli, U.S. background)

By Marcus George

DUBAI, June 5 (Reuters) - An adviser to Iran's supreme leader has urged world powers to formally recognise its nuclear rights to bring about a "favourable result" at talks on its atomic programme later this month, state media reported on Tuesday.

Deflecting Iranian pressure in talks last month, Western countries declined to accord any such recognition, saying Tehran had no automatic right to enrich uranium because of its previous violations of the nuclear Non-Proliferation Treaty.

Iran says that under its NPT membership, it can develop a full nuclear fuel cycle for peaceful purposes including the enrichment of uranium, a process that yields fuel for power stations or bombs, depending on the level of refinement.

"I hope the P5+1 group recognises Iran's inalienable nuclear right within the framework of the NPT and refrains from sitting on the sidelines," IRNA quoted Ali Akbar Velayati, an aide to Ayatollah Ali Khamenei, as saying.

"By accepting Iran's right to use peaceful nuclear energy, the forthcoming talks in Moscow should reach a favourable result."

Khamenei - who has total command over Iran's nuclear policy - has publicly forbidden the development of nuclear weapons. Iran says it is enriching uranium only for civilian energy.

Western nations suspect that the Islamic Republic's higher-grade uranium enrichment is part of a clandestine programme to develop the material and components needed for a capacity to produce nuclear arms.

Despite Velayati's firm line, diplomats say Iranian negotiators were forthcoming at the talks in Baghdad - in contrast to previous failed negotiations - and believe Khamenei has given them a freer hand to explore a deal.

Another round of talks has been scheduled for June 18-19 in Moscow. Last week U.S. Secretary of State Hillary Clinton indicated the meeting would be crucial because of Washington's need to see "concrete actions".

Iran has at times appeared flexible on halting higher-grade enrichment if its requirements for fuel are met.

But in recent weeks Israeli Prime Minister Benjamin Netanyahu has demanded the powers get tougher with Iran and insists it halts all enrichment. He has also reserved Israel's right to take military action against Iran if negotiations fail.

Velayati played down the possibility of Israeli military strikes: "They neither have the power nor the courage to do such a thing."

Iran is refining uranium to 20 percent of fissile purity - well above the level required to run nuclear power plants - for what it says will be fuel for a medical research reactor.

But Western officials are worried because the 20 percent level hurdles major technical barriers to reaching the 90 percent - or bomb-grade - threshold and they believe Iran is stockpiling more material than it needs for nuclear medicine. (Reporting By Marcus George; Editing by Mark Heinrich)