Jerusalem (CNSNews.com) - Analysts here warned that a new U.S. intelligence report saying that Iran stopped its pursuit of nuclear weapons in 2003 could scuttle international efforts to rein in the Islamic Republic.

"The U.S. still plans to continue to try to prevent Iran from producing nuclear weapons," Israeli Prime Minister Ehud Olmert said on Tuesday. "We will make every effort -- first and foremost with our friends in the US -- to prevent the production of this type of weapon."

Olmert's spokesman Mark Regev said that Olmert was not surprised by the findings of the U.S. National Intelligence Estimate. Israel is hoping that it will "galvanize international pressure" against Iran's nuclear pursuit, Regev said.

But experts here warned that the new report was "very bad" and could undermine the international effort to stop Iran from getting a nuclear weapon.

Iran certainly doesn't intend to send candy 1,600 miles in the missiles it is producing, Iranian expert Menashe Amir told Cybercast News Service.

Even if the report is true and Iran abandoned its nuclear weapons program four years ago, it doesn't mean Iran cannot renew it at any time, Amir said.

Amir said he was warning Western intelligence agencies that Iran could be conducting underground nuclear military activities that the West does not know about.

Two years ago, Iran prevented International Atomic Energy Agency inspectors from visiting military installations at two military bases in Lavizan and Parchin, in the suburbs of Tehran, he said.

Israeli Defense Minister Ehud Barak said that while Iran mayhave stopped its pursuit of nuclear weapons four years ago, it has resumed its quest since then.

It is not Israel's place to assess U.S. policy, Barak said in a radio interview. There are differences in assessments of different organizations in the world, he said, and "only time will tell who is right."

National Infrastructure Minister Binyamin Ben-Eliezer said that Israel must "continue to act in every way against the Iranian nuclear threat." Israel is working under the premise that Iran is still pursuing nuclear weapons, said Ben-Eliezer, a former Israeli defense minister.

"This is exactly one of the issues over which the state of Israel must take no risk," he said in a radio interview.

Dr. Ephraim Kam, deputy director of the Institute for National Security Studies, said the new intelligence assessment "clearly changes the picture."

"The American administration won't be able to carry out a military option against the Iranian side," Kam told Cybercast News Service. It also would be difficult for Israel to carry out a military operation if America says that Iran is not pursuing nuclear weapons, he said.

The NIE also may affect sanctions against Iran since many governments -- especially United Nations Security Council members Russia and China -- didn't like the idea of sanctions anyway, Kam said. Those two countries may now refuse to follow through with sanctions, given the news that Iran is no longer presumed to be pursuing nuclear weapons.

The Russians, who said there was no evidence that Iran was trying to produce atomic arms, can now say that it was right in its assessment. And it's a "kind of a victory" for IAEA chief Mohamed ElBaradei, who also reported that there was no evidence of a nuclear weapons program.

"It's really an unexpected gift for the Iranians," Kam said.

But Kam cautioned that intelligence reports can be wrong and the picture could change again. Since Iran is continuing to enrich uranium, it may be intent on developing weapons at some point.

Dr. Ze'ev Maghen, director of Middle East studies at Bar Ilan University in Tel Aviv, said the U.S. appeared to have lost its nerve and was backing down from its former tough stance on Iran. He said it was "ridiculous" to claim that Iran is no longer trying to produce nuclear weapons.

Iran going about strengthening itself in order to destroy Israel, Maghen told Cybercast News Service. "There is no question that Iran is moving toward producing large numbers of nuclear weapons."

The problem of Iran is more acute than ever, said Maghen, because the U.S. has pretty much given Iran a "green light."

Israel is on the front lines, he said. If the front lines are abandoned then its allies will be next, he said.

A U.S. National Intelligence Estimate released on Monday said that Iran had stopped its work on developing nuclear weapons in 2003. Though the report said that Iran was continuing to enrich uranium, it said that the Islamic Republic would only be able to enrich enough for a bomb by 2010 at the earliest -- more realistically, by 2015.

Until now, the U.S. has led the campaign against Iran by claiming that it was using its civilian nuclear program as a cover-up to make an atomic bomb.

Israel has deferred to the U.S. in dealing with Tehran, arguing that Iran was a menace not only to Israel but to the region and the entire world.

In 1981, Israel incurred the wrath of the international community when it bombed a nuclear reactor in Iraq shortly before it became operational. Later, U.S. officials thanked Israel for its foresight.