"We will make the Americans regret their ugly and illegal action against the consulate of Iran in Arbil in Iraq and kidnapping five of our diplomats," Foreign Minister Manouchehr Mottaki said according to state television.

He added that Iran in the next two days would send a letter to UN Secretary General Ban Ki-moon protesting "the lack of attention and clear, indefensible discrimination of the Security Council" on the issue.

The United States in January arrested five Iranian officials working for an Iranian office in the northern Iraqi city of Arbil, accusing the men of belonging to the elite special operations force of the Revolutionary Guards.

US military officials have also said two other Iranians have been detained in Iraq but it is unclear when and where they were arrested.

Iran insists that the men are diplomats working for a "consulate" and the affair has further soured the atmosphere between the two foes even after their highest-level public contacts in 27 years two weeks ago.

Those talks in Baghdad between Iranian ambassador to Iraq Hassan Kazemi Qomi and his US counterpart Ryan Crocker on Iraq's security appeared to achieve no major breakthrough and no date was set for a further encounter.

However Iranian officials on Tuesday appeared to express readiness to continue the talks, as Iraqi Deputy Prime Minister Barham Saleh visited Tehran.

"If the Americans decide to change their policies on Iraq we will examine positively a request from the Iraqi government to continue the discussions with the United States," Mottaki said.

"It is agreed that Iran will examine positively a request from the Iraqi government to continue discussions with the United States," added Kazemi Qomi, in Tehran for Saleh's visit.