The United States has rejected an Iranian suggestion to hold higher-level talks on the security situation in Iraq.

State Department spokesman Sean McCormack said he does not see talks between the U.S. and Iran at the level of deputy foreign minister at this time.  McCormack said the two sides have already established a diplomatic channel between their ambassadors in Iraq.

Iran's foreign minister, Manouchehr Mottaki, had proposed the higher-level talks earlier Wednesday.

Tuesday, U.S. and Iranian ambassadors to Iraq held a second round of talks on Iraq's security in Baghdad.

US Ambassador to Iraq Ryan C. Crocker speaks during a press conference after meeting with the Iranian Ambassador Hasan Kazemi Qomi in Baghdad, Iraq, 24 July 2007

U.S. Ambassador Ryan Crocker said there were some "heated exchanges" when he told his Iranian counterpart that Iranian support for Shi'ite militias in Iraq has risen since they held a first round of talks on the issue in May.

Iran has denied supplying weapons and training to Shi'ite militias in Iraq. 

Iran, Iraq, and the U.S. agreed to create a security committee on Iraq, but Crocker said no progress can be made unless Iran changes its behavior in Iraq.

The United States had said the talks with Iran would focus solely on the security situation in Iraq, despite tensions over Iran's nuclear program and Iranian-Americans detained by Tehran.

The United States and Iran have had little official contact for 27 years. 

The United States broke diplomatic relations in April, 1980 after Iranian activists seized the U.S. Embassy in Tehran and took its staff hostage.

Relations between Iran and Iraq have improved since the ouster of Saddam Hussein as Iraqi leader.  Both countries have Shi'ite majorities.  Saddam's Sunni-led government fought Iran in the 1980-1988 Iran-Iraq war.

Some information for this report was provided by AFP and Reuters.