Iran is closing in on production of nuclear weapons and even UN sanctions may not deter the aggressive government in Tehran, a top State Department official said Friday. Describing the Iranian government as "very aggressive, very determined to develop nuclear weapons," Robert Joseph, undersecretary for arms control and international security, dismissed Iran's contention it seeks only civilian nuclear power. Iran has methodically taken all but one last step to turn out nuclear weapons, he said. "Once they begin to enrich that is the point of no return," Joseph said. Negotiations between the European Union and Iran to stop Iran with offers of economic incentives have foundered. Still, Joseph said the United States was relying on diplomacy to try to deter Iran. In the meantime, he said, the Bush administration has held off seeking economic sanctions against Iran in the UN Security Council in order to solicit the support of Russia and China. However, Iran is so determined to produce nuclear weapons that sanctions might not stop the accelerating drive, he said. He cited, as an example, President Mahmoud Ahmadinejad's incendiary statement that Israel should be "wiped off the map." Ahmadinejad continued his anti-Israel rhetoric Thursday afternoon, denying the Holocaust and calling on Germany and Austria to create a Jewish State within their borders, Israel Radio reported. "We do not believe that Hitler killed six million Jews, but even if this is true by some chance, then why should the Palestinians pay the price for it," he asked, and suggested that the governments in Vienna and Berlin concede two or three provinces to the Zionists and settle the Israeli-Palestinian conflict once and for all. "If Germany and Austria feel responsible that the Jewish people suffered at their hands during the Second World War, then all they should do is create a Zionist State in their territory," he said in a television interview in Teheran. Israeli officials condemned Ahmadinejad's comments as "outrageous and even racist." "Unfortunately, this is not the first time that the president of Iran has made outrageous and even racist remarks concerning Jews and Israel," Foreign Ministry spokesman Mark Regev said. "Only recently the UN General Assembly condemned Holocaust denial and here the Iranian leader is showing himself to be fundamentally contradicting the norms of international behavior and decency," he added. "I hope that anyone who had illusions about the true nature of the Iranian regime has received these recent remarks as a wake up call." British Foreign Secretary Jack Straw said, "The comments attributed to President Ahmadinejad are wholly unacceptable, and I condemn them unreservedly. They have no place in civilized political debate." Earlier in the week Iran intensified its diplomatic attacks on Israel, claiming that the recent political crisis exposed the fact that Israel is leading the international pressure on Teheran. The spokesman for the Iranian Foreign Ministry implied that if Israel were to attack its nuclear facilities, they would respond with an inevitable painful blow. These statements came in response to harsh comments released by the Israeli Foreign Ministry regarding the Iranian nuclear project. An Iranian spokesman referred to an "internal crisis of the Zionists," adding that the Israeli threats against it were born of the failure of Jerusalem to turn the international community against Teheran. Sources close to Defense Minister Shaul Mofaz said on Monday that Israel knows well what to do about Iran, and that the noisy suggestions about Iran on the part of Israeli politicians only harm Israel's security.