The BBC's Barnaby Mason in New York: "Serious differences with the Russians"

A statement issued in New York after a meeting between the United States, Russia, China, Britain and France said officials had been instructed to continue talks on the matter.

The statement said it was hoped a text could be adopted as soon as possible.

At issue is a proposed offer to suspend some sanctions against Iraq in return for Iraqi co-operation with a new systems of weapons inspection.

Inching forward

Britain's Ambassador to the UN Sir Jeremy Greenstock said progress was being made, but slowly.

"We're moving millimetre by millimetre, but we're not there yet," he said.

China's deputy ambassador to the UN said the agreement to continue talks was a "step forward".

"At least it shows that the [five nations] are willing to discuss the issue, to reach agreement and to push it forward," Shen Guofang said.

Weapons inspectors pulled out last year

Western diplomatic sources say significant progress has been made in closing the gap on policy towards Baghdad between France and the US and Britain. But differences remain between the Western powers and Russia.

It is understood that the main problems have concerned the mechanism which should trigger any future suspension of sanctions and the scope of that suspension.

Russia and France have argued for a more generous approach to Iraq, while Britain and the US take a harder line.

The UN Security Council members have been at loggerheads over Iraqi policy since the US-British air strikes of December last year.

Inspectors from the UN Special Commission (Unscom) charged with monitoring Iraqi disarmament left Baghdad just before the air strikes.

The Iraqi Government has barred them from returning, accusing them of spying, until the sanctions are lifted.