By Stephanie Nebehay

Iran and major powers made "limited" progress on Sunday in narrowing differences over its nuclear program, but agreed to step up efforts as the Obama administration lobbied to stave off fresh sanctions against the Islamic Republic, diplomats said.

The Geneva negotiations, held at the level of political directors, are the culmination of five days of diplomacy in the Swiss city and Paris, including lengthy meetings between U.S. Secretary of State John Kerry and Iranian Foreign Minister Mohammad Javad Zarif.

"Substantive progress is limited, experts will continue tomorrow morning. It is fair to say that everybody is committed to stepping up efforts," a diplomat told Reuters as deputy ministers began a final session late on Sunday afternoon.

"There is a good atmosphere in the sense that we will probably be meeting more in the months to come to try to make progress."

Helga Schmid, EU political director, chaired the closed-door talks at the EU diplomatic mission in Geneva, attended by officials from Iran and Britain, China, France, Germany, Russia and the United States.

Acting Deputy Secretary of State Wendy Sherman led the U.S. delegation, while Iran was represented by deputy minister Abbas Araqchi. Neither spoke to reporters on arrival.

U.S. President Barack Obama warned lawmakers on Friday not to trigger new sanctions against Iran over its nuclear program, saying such a move would upset diplomatic talks and increase the likelihood of a military conflict with Tehran.

"Time is running short and it's the hope of Beijing that all parties will seize that historical opportunity by racing against the time and by doing two things: first is to adopt a pragmatic and a flexible approach with wisdom and secondly is to demonstrate with possible and maximum political will, with resolute political decisions," China's envoy Wang Qun told reporters in Geneva on Sunday.

Negotiators failed in November to meet a self-imposed deadline for clinching an elusive agreement seen as crucial to reducing the risk of a wider Middle East war. The new deadline for a final deal is June 30, but officials hope to reach an understanding on key parameters by the end of March.

Under a 2013 accord between Iran and the United States, France, Germany, Russia, China and Britain, the Islamic Republic halted its most sensitive nuclear activity and took other steps in exchange for some easing of economic sanctions.

It was negotiated to buy time for talks on the final settlement of a more than decade-old dispute over Iran's nuclear program, which it says is peaceful but the West fears may be aimed at developing a capability to produce nuclear weapons.

(Reporting by Stephanie Nebehay and Marina Depetris; editing by Ralph Boulton and Susan Thomas)

Reuters