UPDATE 1-U.S. says Iran faces cooperation or conflict

(Adds more details from statement)

By Sue Pleming

WASHINGTON, July 19 (Reuters) - The United States said on Saturday after inconclusive talks with Iran that Tehran had a choice between cooperation or conflict and negotiations could begin with Washington only if sensitive nuclear work ended.

"We hope the Iranian people understand that their leaders need to make a choice between cooperation, which would bring benefits to all, and confrontation, which can only lead to further isolation," said State Department spokesman Sean McCormack after the Geneva talks, attended for the first time by senior U.S. diplomat William Burns.

He said Burns did not meet separately with any member of the Iranian delegation and EU foreign policy chief Javier Solana delivered a clear message to the Iranians but did not get a straight answer in return.

"Mr. Solana did not get a straight 'yes' or 'no' answer. Mr. Solana stressed that Iran needs to give a clear answer within two weeks," said McCormack, who was given a report on the meeting from Burns.

Burns' attendance at the Geneva talks was a sharp departure from the usual U.S. policy, which was not to talk to Iran about its nuclear program until Tehran gave up uranium enrichment work the West believes is aimed at building an atomic bomb. Iran says it is for peaceful power purposes.

McCormack said Burns told Iranian negotiator Saeed Jalili that Washington was serious in its support for a package of incentives delivered by major powers last month but Iran had to suspend enrichment to have negotiations involving the United States.

"As Mr. Solana said today after the meeting, Iran has a choice to make: negotiation or further isolation," said McCormack. (Reporting by Sue Pleming, editing by Patricia Zengerle)