A former head of Israel's Mossad on Monday urged the West to solve the nuclear dispute with Iran through diplomacy rather than military action.

Ephraim Halevy expressed backing for U.S. President Barack Obama's approach to Iran, saying that Republican challenger Mitt Romney's anti-Iran rhetoric closes the door to dialogue.

In an interview with Israel Radio, Halevy called Obama's policy "brave" and said sanctions against Iran were a "success" because they have caused a severe economic crisis. The interview came hours before the third and final debate between Obama and Romney, which will focus on U.S. foreign policy.

"The goal of the sanctions is not to prepare the ground for a military operation, but to convince Iran's leadership to abandon its nuclear program," he said in a separate interview on Sunday.

“Over the years … I realized that, in order to be effective with one’s enemies, you have to have two essential capabilities: To overcome them by force if necessary … And do everything you can to get into their minds and try to understand how they see things … and where if at all there is room for common ground of one kind or another,” Halevy said in the interview with online news site Al-Monitor.

“I think that what we have had over the years is an abundance of one side, and a dearth of the other,” he added.

“The Iranians, in their heart of hearts, would like to get out of their conundrum,” Halevy told Al-Monitor. “The sanctions have been very effective. They are beginning to really hurt.”

Halevy said that in earlier stages of his career, “I realized that dialogue with an enemy is essential. There is nothing to lose. Although the claim was, if you talk to them, you legitimize them. But by not talking to them, you don't de-legitimate them. So this convinced me, that we all have been very superficial in dealing with our enemies.”

He referred to other conflicts in which the U.S. and Israel have "tied our own hands," such as relations with Hamas, noting that, “In the end, you create an inherent disadvantage for yourself.”

“On Iran, you have to go much deeper,” Halevy said. “You have to understand what it is that makes Iran tick.”

Halevy acknowledged that negotiating a deal with Iran would be "extremely difficult," and that it would require significant reserves of creativity and political courage.

“The perception is that Israel is going through the stages of sanctions, etc. not with the idea or conviction that at the end, the other side will yield. If the purpose was to exert pressure to bring the other side to the table, the rhetoric should be different."

“Obama does think there is still room for negotiations. It’s a very courageous thing to say in this atmosphere. In the end, this is what I think: Making foreign policy on Iran a serious issue in the US elections — what Romney has done, in itself — is a heavy blow to the ultimate interests of the United States and Israel,” he said.

Halevy served as Mossad head from 1998-2002.

The New York Times on Saturday reported that the United States and Iran had agreed in principle for the first time to hold one-on-one negotiations on the disputed nuclear program.

The White House has denied the report.

Prime Minister Benjamin Netanyahu said on Sunday in a statement that Israel had "no information" on the reported secret contacts, adding that Iran was using talks to "buy time."

"I have no reason whatsoever to believe that in talks with the U.S., Iran would act differently," he said.

Open gallery view Ephraim Halevy Credit: Yotam Frum