Iran situation "not good news" - French official

By Crispian Balmer

PARIS (Reuters) - The situation in Iran is extremely worrying and has set back hopes of better relations with Tehran, French officials said on Sunday.

"What is happening in Iran is clearly not good news for anyone, neither for the Iranians nor for peace and stability in the world," said Henri Guaino, one of French President Nicolas Sarkozy's closest advisors.

Protesters have clashed with police in Tehran for two days running after Iranian authorities declared hardliner Mahmoud Ahmadinejad outright winner in a contested presidential ballot.

France is a permanent member of the United Nations Security Council and is part of a group of six world powers that is trying to persuade Iran to halt its nuclear ambitions.

French Foreign Minister Bernard Kouchner said on Sunday that "brutal" repression of Ahmadinejad's opponents was closing the door to dialogue within Iran and warned that confrontation would be counterproductive.

"Brutality and never-ending military development will not bring any solutions," Kouchner said after meeting U.S. special envoy to the Middle East George Mitchell in Paris.

The United States, Russia, China, France, Germany and Britain have invited Iran to talks to find a diplomatic solution to the nuclear row, but Tehran has so far rejected the offer.

The major powers suspect Iran wants to produce a nuclear weapon. Tehran says it wants to generate electricity.