US President Barack Obama and Iranian President Mahmoud Ahmadinejad were both in the spotlight -- though they never met -- at the UN General Assembly meetings, on a day of dueling rhetoric and diplomatic jockeying.

Ahmadinejad said an Iranian official may meet European Union foreign affairs chief Catherine Ashton next month in a bid to open new international talks on a program which the West says is a quest for nuclear weapons.

He said some of the six powers negotiating on the nuclear dispute -- Britain, China, France, Germany, Russia and the United States -- had had contacts with Iranian Foreign Minister Manouchehr Mottaki at the UN this week.

Ahmadinejad insisted it was up to Ashton to initiative moves for what he said was a meeting in October scheduled under a longstanding plan.

"If Ms Ashton contacts the Iranian representative she can set a time for talks," the Iranian leader told a press conference.

Denis McDonough, chief of staff of Obama's National Security, noted that Ashton reached out to Iran earlier this year, but never heard back.

"When she hears back, we will know whether they are serious or not," he said.

A day after telling Iran that the door for diplomacy was still open, Obama told the BBC Persian service that a genuine dialogue could see tough new sanctions on Iran removed, along with the fear of armed confrontation.

"Our strong preference is to resolve these issues diplomatically. I think that's in Iran's interest. I think that is in the interest of the international community," Obama said.

"I think it remains possible, but it is going to require a change in mindset inside the Iranian government."

Obama meanwhile lashed out at Ahmadinejad over his tirade to the UN Security Council on Thursday, in which he suggested the US government staged the September 11 attacks in 2001.

"It was offensive, it was hateful," Obama said, slamming Ahmadinejad's remarks, and bemoaning the fact the outburst took place in Manhattan, so close to the Ground Zero footprint of the felled World Trade Center twin towers.

About 3,000 people died in the attacks by Al-Qaeda operatives who hijacked passenger jets and flew them into the World Trade Center in New York and the Pentagon in Washington. A fourth plane crashed in Pennsylvania.

Ahmadinejad said in his speech that there was a theory that "some segments within the US government orchestrated the attack."

"The majority of the American people as well as other nations and politicians agree with this view," he declared to the astonished chamber.

Ahmadinejad showed no desire to quell the controversy on Friday, calling for a UN probe into the "true reason" for the strikes, which he said led to US military actions that killed thousands in Iraq and Afghanistan.

In another development, freed US hiker Sarah Shourd said she met Ahmadinejad in New York to plead for the release of her finance and a friend still jailed in Iran.

"For me to talk to the president, it is something I prayed for while in prison," Shourd told ABC News.

Shourd, 32, was released last week after being detained in July 2009 in Iran, but had to leave behind her fiance Shane Bauer and friend Josh Fattal.

The hikers say they strayed by accident into Iran in July 2009 while hiking in the mountains in Iraqi Kurdistan. But Iranian authorities have alleged that they were spying.

Despite painstaking diplomacy, Iran has so far refused to accept an EU and US package of engagement and incentives to halt what the West says is a drive for nuclear weapons -- a charge Tehran denies.

US officials said here that they believe that the tough new range of sanctions imposed on Iran four months ago is beginning to bite, and has exacted a deeper toll on the economy than the government expected.

However, Obama admitted in his BBC interview that there were "no guarantees" the sanctions would force Iran to change its behavior, though expressed hopes they would cause deep reflection among Iranian leaders.

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