The meeting of the council's permanent members -- Britain, China, France, Russia and United States -- plus Germany, agreed to send the latest draft resolutions back to their governments, the sources said.

They were to decide on Friday morning whether to distribute the text to UN Security Council members. One diplomat, speaking on condition of anonymity, said that if there was agreement there could be a vote on the resolution next week.

A non-proliferation item has been put on the Security Council's agenda for Friday.

The six countries have been working for weeks on a resolution to demand that Iran halt its uranium enrichment activities, which the United States and its allies believe hides nuclear weapon development.

China and Russia have been resisting US pressure to threaten sanctions against the hardline Islamic government.

Thursday's meeting went ahead despite China's anger over a "watered-down" statement on the killing of four UN peacekeepers during an Israeli attack in Lebanon this week.

China's envoy Wang Guangya had warned that the US refusal to accept criticism of Israel in a Security Council statement could have a "negative impact" on other council work, including the Iran resolution.

Before the dispute erupted at the United Nations over Lebanon, diplomats had reported progress in their negotiations, which have been marked by China and Russia's refusal to accept any talk of sanctions.

Diplomats said the main elements of the draft under discussion reflect a communique adopted by foreign ministers from the six at a meeting in Paris on July 12.

"One fundamental element of that agreement is to make the suspension of all enrichment-related activities mandatory, including research and development," said French envoy Jean-Marc de La Sabliere on Tuesday.