An explosion in southern Iran this morning occurred in the process of road building in the region.

A spokesman for the Iranian National Security Council confirmed that rock blasting was taking place in the area, and no other explosion had happened.

Reports earlier indicated that a missile had been fired from an unknown plane 20 km from the Gulf port city of Dailam, 150km from the site of Iran's only nuclear plant in Bushehr province.

Other sources said the explosion could have been the result of an empty fuel tank falling from an Iranian plane.

The reports led to fears that some form of attack on the installation might be in progress.

Tehran earlier accused the US of using satellites 'and other tools' to spy on its nuclear sites.

The Israeli Foreign Minister said in London this morning that Iran was just six months away from having the knowledge to build an atomic bomb.