WASHINGTON, July 2 (Xinhua) -- An Israeli strike on Iran could destabilize the Middle East, Admiral Michael Mullen, chairman of the Joint Chiefs of Staff, told a news conference here on Wednesday.

    Speaking of a flurry of speculation that Israel is planning a strike against Iran's nuclear facilities, Mullen refused to comment on what Israel might be planning over Iran's nuclear facilities. Instead, he stressed the need for greater dialogue with Iran.

    "This is a very unstable part of the world and I don't need it to be more unstable," he said.

    "Opening up a third front right now would be extremely stressful on us," Mullen added, apparently referring to wars on two fronts: the nearly seven-year-old campaign in Afghanistan and more than five years in Iraq.

    On Iran's nuclear program, Mullen said that "I believe they're still on a path to get nuclear weapons and I think that's something that needs to be deterred."

    However, the top U.S. military officer noted that the settlement of Iran's nuclear disputes should be done through diplomatic, financial and economic actions by the United States and other nations.

    U.S. President George W. Bush reiterated earlier in the day that diplomatic solution to Iran's nuclear issue is "the first option" although "all options are on the table."

    "I have always said that all options are on the table but the first option for the United States is to solve this problem diplomatically," Bush told a news conference in the White House Rose Garden.

    "And the best way to solve it diplomatically is for the United States to work with other nations to send a focused message - and that is, you will be isolated, and you will have economic hardship if you continue to enrich."

    Prior to the remarks by Bush and Mullen, Iranian Foreign Minister Manouchehr Mottaki said Tuesday that Iran is "seriously and carefully examining" a package of economic incentive offered by the United States and its negotiating partners.

    "We see the potential for a new round of talks ... The two sides are trying to see if they can arrive at a new modality," Mottaki told reporters at Iran's United Nations mission, noting that Iran would officially respond the international offer "withinweeks."

    The United States and its western allies accused Iran of trying to develop nuclear weapons under the cover of its stated goal of developing civilian nuclear power. Iran denies the U.S. allegations.