President Barack Obama said on Thursday he was extending sanctions against Iran as it continued to pose an "extraordinary threat" to the national security, foreign policy and economy of the United States, according to Reuters.

Obama declared the routine extension of economic sanctions imposed by former President Bill Clinton in March 1995 in a public notice. "I am continuing for one year the national emergency with respect to Iran," he said.

In a change of policy from the Bush administration, Obama has said he would be open to engaging with Iran on a range of issues, from its nuclear ambitions to how it could help in Afghanistan, where NATO-led forces are struggling against a worsening insurgency.

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The Obama administration intends to invite Tehran to an international conference on Afghanistan, which borders Iran, planned for this month. Iran has said it is prepared to consider the invitation.

The United States, however, is still at loggerheads with Iran over its nuclear program, which Washington says is aimed at building atomic weapons, while Tehran insists it is for the peaceful generation of electricity.

The United States cut off diplomatic ties with Iran during the 1979-81 hostage crisis, in which a group of militant Iranian students held 52 U.S. diplomats hostage at the American embassy for 444 days.

Obama has said the United States is prepared to extend a hand of peace to Iran if it "unclenched its fist". Iranian President Mahmoud Ahmadinejad has said he is open to talks with Washington but has demanded a fundamental change to U.S. policy in the Middle East.