Prime Minister Ehud Olmert plans to convene a senior level consultation to discuss the Iranian threat. Foreign Minister Tzipi Livni, Defense Minister Amir Peretz and senior members of the intelligence community will attend the meeting on Thursday, the second time this forum has convened.

The group will debate Israeli policy toward Washington's proposed sanctions. It will also discuss developments in light of the Lebanon War, with even moderate states expressing concern about Iran. Olmert will update participants on his conversations last week with Condoleezza Rice on regional organization.

The forum, including the defe nse and foreign ministers, heads of the Mossad, military intelligence and the Shin Bet security service, was established during former Prime Minister Ariel Sharon's tenure to coordinate a "diplomatic foil" for the Iranian threat. Mossad chief Meir Dagan was given operational authority, and will review recent developments in the meeting.

Sources at the United Nations estimate informal consultations will start tomorrow on a draft resolution to impose sanctions - starting with "soft" measures such as the threat of increasing severity - should Iran continue to refuse to stop enriching uranium. A senior Western diplomat in New York told Haaretz yesterday that "assembling sanctions has begun."

The agreement on punitive steps against Iran was reached Friday in a London meeting of the foreign ministers of the five permanent Security Council members - the U.S., U.K., Russia, France and China - and Germany.

Russian Foreign Minister Sergey Lavrov said after the meeting, "the crisis with Iran can still be settled through diplomatic means." However, UN sources say Russia has agreed behind the scenes to limited and reversible punitive measures against Tehran. China is expected to follow suit.

The New York Times yesterday quoted State Department officials who said the draft Security Council members will discuss next week includes sanctions from the "menu" devised by Washington at the beginning of the year. It includes an embargo on sales of nuclear technology and limits on Iranian officials' international travel.