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The United States is opposed to enacting a new set of financial sanctions against Iran that are due to be discussed in the G8 summit next week, diplomatic officials in New York reported Friday.

According to officials, sanctions against Iran are expected to top the G8's agenda. Sources are also predicting a pointed debate between the heads of the industrialized nations over an appropriate response to Iranian authorities' suppression of reformist demonstrations in Iran led by Mir Hossein Mousavi and other Iranian opposition leaders.

Italian Prime Minister Silvio Berlusconi hinted in a newspaper interview earlier in the week that the G8 is due to decide on new financial sanctions against the Islamic Republic. Berlusconi disclosed that he had spoken with the heads of the G8 nations and has discussed such steps with them.

According to the Italian prime minister, "the general leaning [among G8 leaders] is toward sanctions."

However, diplomatic sources in New York reported that American officials are working behind the scenes to prevent new sanctions from being imposed against Iran.

U.S. officials claimed that a tough stance toward Iran could backfire, bringing about an opposite outcome to that desired by those who support such measures.

The Obama administration, according to the diplomatic sources, has discarded the notion of direct talks with Iran. However, the United States is still interested in re-engaging Iran through the renewed discussion of its nuclear program through the five permanent United Nations Security Council members and Germany.

American officials expressed concern that a decision to enact harsh steps against Iran during the G8 meeting could badly hurt the prospect of Tehran agreeing to renew negotiations with the permanent Security Council members.

In addition to U.S. reluctance to enact fresh sanctions, G8 members Russia and China have been known to oppose any punitive steps against Tehran.

The Security Council has already imposed several rounds of sanctions against Iran, including a weapons embargo and a ban on supplying Iran any materials which could be used to advance its disputed nuclear program.

New sanctions could include forbidding western oil companies from maintaining commercial ties with Iran.