Scientists and researchers at the Atomic Energy Organisation of Iran have succeeded in producing and testing the first sample of a nuclear fuel rod,” said the announcement.

The rods, which contain natural uranium, were made in Iran and have been inserted into the core of Tehran’s research nuclear reactor, state television reported Sunday. Nuclear fuel rods contain small pellets of fuel, usually low-enriched uranium, patterned to give out heat produced by nuclear reaction without melting down.

“This great achievement will perplex the West, because the Western countries had counted on a possible failure of Iran to produce nuclear fuel plates,” the Tehran Times newspaper said. The development was announced at a time of growing tension between Western powers and Iran after the UN nuclear agency reported in November that Tehran appeared to have worked on designing a nuclear weapon.

The US and its European allies have increased the sanctions pressure on Iran, one of the world’s largest oil producers, to push Tehran to halt the enrichment. Western analysts say Iran sometimes exaggerates its nuclear advances to gain leverage in its stand-off with the West.

Meanwhile, Iran test-fired a new medium-range missile, designed to evade radars, on Sunday during the last days of its naval drill in the Gulf, the official IRNA news agency quoted a military official as saying.

The mid-range surface to air missile which is equipped with the latest sophisticated anti-radar technologies has been successfully test-fired, Deputy Navy Commander Mahmoud Mousavi told IRNA. Iran has long-range missile systems including the Shahab-3, which could reach Israel and US bases in the Middle East. The US and Israel say they have not ruled out military action. In the past week Iran has threatened to stop ships moving through the strategic Strait of Hormuz if sanctions are imposed on its oil exports.