China on Tuesday reiterated that it was best to solve the Iranian nuclear standoff through continued diplomatic effort and said there was yet room for dialogue to resolve the issue.

"Like Foreign Minister Yang Jiechi said on Sunday, the best way to solve the problem is through dialogue," spokesman Qin Gang told reporters on Tuesday.

In fact, Yang had stressed that it was China's "consistent position to uphold the international nuclear non-proliferation treaty", while holding a press conference at the Great Hall of the People on Sunday.

There has been speculation that China may, in the end, go along with fresh sanctions against Iran as some recent unconfirmed data had shown that China's imports of Iranian crude oil had fallen to a three year low in January.

Qin, however, said that the data, if accurate, had no relevance to China's political stance. "When, and how much, Chinese companies (choose to) import oil from Iran depends on commercial principles," he said.

"China imported 23 million tons of crude from Iran in 2009, accounting for 11 percent of its total oil import," Hua Liming, China's former ambassador to Iran, told China Daily.

Hua, however, said he hadn't seen any recent official data showing a drop in China's oil purchase from the world's second largest oil and natural gas producer.

"The key word in Yang's speech is that diplomatic efforts haven't been exhausted, and that means, as long as Iran does not shut the negotiation door completely, China will persist with talks. However, if sanctions were to be the solution in the end, China will still consider its national interest and try to minimize the damage," he said.

The US agreed with Britain, France and Germany last week on a draft proposal for a fourth round of sanctions against Iran, which were later passed on to Russia and China for comment.

The draft includes a call for restrictions on more Iranian banks and possibly a full arms embargo on Teheran accompanied by an inspection team. Iranian oil and gas industries were not listed in the proposal this time.

Some analysts in the US believe China is gradually warming up toward the idea of a fourth round of sanctions, and listed its silent acceptance of a February IAEA report as proof.

Last month, the IAEA issued a new report stating that Iran's continuing evasion of the international oversight of its nuclear activities raises suspicions that its ulterior motive is to build a nuclear weapon.

The Christian Science Monitor quoted Alex Vatanka, an Iranian-American scholar at the Middle East Institute in Washington, as saying: "It's very likely that the Chinese, and the Russians will eventually decide it is not in their interest to continue holding up the sanctions. But that does not mean that what they finally go along with will be anything meaningful".

Iran's envoy to the IAEA Ali Asghar Soltanieh, however, said the report "is not balanced or factual" and that it "contained tremendous confidential technical details which created a lot of confusion".