WASHINGTON - World powers decided Thursday to lay the groundwork for another round of negotiations with Iran over its disputed nuclear program, a senior U.S. official said, but they want a significantly improved offer from the Islamic republic.

Neither the U.S. nor any of its international partners was ready to abandon diplomacy in favor of military or other actions, as Israeli President Benjamin Netanyahu has advocated.

The new hope for negotiated end to Iran's decade-long nuclear standoff came after Secretary of State Hillary Rodham Clinton met with the foreign ministers of Britain, China, France, Germany and Russia - powers that have sought, over several rounds of talks, to persuade Iran to halt its production of material that could be used in nuclear weapons. All such efforts have failed so far.

The latest stab at a diplomatic compromise collapsed this summer after Iran proposed to stop producing higher-enriched uranium in exchange for a suspension in international sanctions, which Clinton has termed a "nonstarter." The U.S. official said Iran would have to bring a much better offer to the table this time, but stressed that nations were seeing some signs for optimism and that diplomacy remained "far and away the preferred way to deal with this issue."

Catherine Ashton, the European Union's top diplomat, who has been spearheading the international diplomacy with Iran, was instructed to reach out to Iran's top nuclear negotiator, Saeed Jalili. Still, no date was set for the possible resumption of the so-called P5+1 talks with Iran, said the U.S. official, who spoke on condition of anonymity because she wasn't authorized to comment publicly about the closed-doors meeting at the United Nations.

After looking for a diplomatic solution there, Clinton met later Thursday with Netanyahu one-on-one for 75 minutes at a New York hotel where she was expected to hear the alternative argument for possible military action. The U.S. official said they agreed that Iran must be prevented from becoming a nuclear power, without going into details.

Their meeting occurred just hours after the Israeli leader warned in an address to the U.N. General Assembly that Iran will have enough enriched uranium for a nuclear weapon by next summer.

Pulling out a red marker while holding a poster depicting a cartoon-like bomb that measured Iran's nuclear progress, Netanyahu drew a "red line" across the second-to-last stage of nuclear development, reminding everyone of his demand for President Barack Obama to declare when the U.S. might attack Iran. Obama has rejected the demand.

It is getting "late, very late" to stop the Iranian nuclear threat, Netanyahu said at the United Nations.

"Red lines don't lead to war; red lines prevent war," he said.

Iran insists its program is solely for peaceful energy and medical research purposes, while the U.S. and many Western and Sunni Arab states see that as a cover for developing nuclear arms. But there is disagreement on how to stop Iran, with Obama insisting there is more time for diplomacy and hard-hitting sanctions while Netanyahu presses for a military response.

That disagreement has spilled over into Obama's bid for re-election, with Republican challenger Mitt Romney accusing the president of being weak on Iran. Romney has promised a more credible threat of military action and closer alignment of U.S. policy with Netanyahu's positions - an argument that resonates with some Jewish and pro-Israel evangelical Christian voters.

Neither presidential candidate, however, advocates clearly for military action.

An attack on Iran's nuclear facilities would surely prompt retaliation. Iran could seek to disrupt fuel supplies from the Persian Gulf, through which about one-fifth of the world's oil flows, or it could support proxies such as Hezbollah to attack Israel or U.S. allies in the Gulf. A worst-case scenario might see the U.S. dragged into another major war in the Muslim world at a time of staggering American debt and continued economic struggles.

Obama and Netanyahu probably will speak by telephone Friday, the White House said, after Clinton's meeting are over. She is doing the bulk of America's diplomatic work at this year's gathering of global leaders in New York, with Obama ruling out any bilateral meetings with presidents or prime ministers so he can spend more time campaigning for re-election.

America's partners also prefer diplomacy.

"We discussed at length the need for Iran to take action urgently," said Ashton, who briefed officials for more than an hour on her recent discussions with the Iranians.

"We were united," said French Foreign Minister Laurent Fabius, refusing to comment on Netanyahu's call for red lines.