Iran still possesses the capacity to produce nuclear weapons even though it may have stopped its atomic arms development program, a senior US intelligence official said Wednesday.

Thomas Fingar, deputy US director of national intelligence for analysis, told a Congressional hearing that the Islamic republic "continues to develop" capabilities that could be swiftly adopted for production of nuclear weapons.

"We judge it has the technical and industrial capability to produce nuclear weapons," he told the House of Representatives armed services committee which held the hearing to make a global security assessment.

Lawmakers were particularly keen to find out from senior intelligence officials who testified Wednesday the background behind a new intelligence report in December saying Iran halted its nuclear weapons drive in 2003 and that US charges about Tehran's atomic goals were overblown.

The National Intelligence Estimate (NIE), a consensus view of all 16 US spy agencies, had also cautioned that Iran was keeping its nuclear options open, still bucked international demands to freeze uranium enrichment, and could have the technical ability to make a nuclear weapon sometime between 2010 and 2015.

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