Jubilant Iranians danced in Tehran streets Friday, hopeful that impoverishing sanctions may soon be lifted and Iran will shed its pariah status, following a breakthrough in talks on nuclear deal with the world's great powers.

In what may turn out to be the single most lasting foreign policy achievement of President Barack Obama's eight years in the Oval Office: an historic rapprochement that is emerging between the Iranian theocracy, long regarded as the terrorist-sponsoring heavyweight in the "axis of evil," and the "Great Satan," as the Islamic regime has dubbed the United States.

Even without a final agreement, the framework of a pact has recalibrated the balance of power in the Middle East.

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"We can co-operate with the world," exulted Iranian President Hassan Rouhani, who was greeted by cheering throngs and motorists honking their horns on a triumphal return to Tehran from Switzerland where the clock was repeatedly stopped to allow talks to continue beyond the original Mar. 31 deadline.

Mr. Obama, who offered in his inaugural address to "extend a hand if you are willing to unclench your fist" and who has sought better relations with Iran throughout his presidency, hailed the breakthrough as "historic."

But newly-re-elected Israeli Prime Minister Benjamin Netanyahu flatly rejected it, saying the deal paved a path for Tehran to join the nuclear weapons club and "threaten the very survival" of the Jewish state.

Israel already has a nuclear weapons arsenal, developed clandestinely, although it isn't among the five nations permitted under international treaty to have them. Mr. Netanyahu said the draft pact "would legitimize Iran's nuclear program, bolster Iran's economy, and increase Iran's aggression and terror throughout the Middle East and beyond."

Eric Shultz, a spokesman for Mr. Obama, responded that "the President would never sign on to a deal that he felt was a threat to the state of Israel."

The Union of Concerned Scientists, perhaps the most dispassionate group capable of evaluating the draft framework, gave it cautious approval but that assessment was all by drowned out by the political clamour.

"How does that interim agreement look, so far, so good," David Wright, a physicist and the co-director of the union's global security program wrote on its website. He said the framework of reductions and inspections, was "an encouraging start" in achieving the two key goals of "placing limits on Iran's program that would stretch to a year the time it would need to make a bomb," and imposing "strict inspection and transparency measures that would allow the international community to quickly detect any Iranian efforts to cheat."

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Amid the duelling din of denunciations and approvals came a cautionary note from French Foreign Minister Laurent Fabius, who reminded everyone that a final pact – if was emerged – was months away at least. "Nothing is signed until everything is signed, but things are going in the right direction," Mr. Fabius said.

That was more than enough for Iranians who desperately seek an end to sanctions that have all but crushed the oil-rich nation's economy. Yet even those opposed to the regime have mostly backed the government's insistence that Iran, a major regional power, cannot be humiliated or denied the right to a nuclear program as long as it meets international curbs on weapons development.

The draft deal essentially offers Tehran a lifting of international isolation and removal of economic sanctions in exchange for verifiable guarantees that Iran won't develop nuclear weapons, at least not until sunset clauses built into the agreement are met. Details, and they are legion, remain to be worked out with a target deadline of June.

Mr. Obama, nearing the twilight of his presidency, said the deal "made our world safer," an echo of the description previous presidents, both Republican and Democrat, used to describe Cold War nuclear arms reductions pacts.

Since 2006, the United Nations' Security Council permanent five – Britain, China, France, Russia and the United States along with Germany, the so-called "P5 plus one" – have been holding on-again, off-again, talks with Tehran over Iran's nuclear program, much of which is clandestine and buried deep in bunkers beneath mountains.

Conducted at the highest levels most recently with U.S. Secretary of State John Kerry meeting regularly and routinely with his Iranian counterpart, the negotiations amount to a new era in U.S-Iranian relations, long officially non-existent. Since the 1979 takeover of the U.S. embassy compound that led to a 444-day hostage crisis, dooming then-president Jimmy Carter's bid for a second term and helping Ronald Reagan reach the White House, relations between Tehran and Washington have ranged from sullen silence to angry exchanges of bitter accusations. Clashes in the Persian Gulf and the shoot down of an Iranian civilian airliner by a U.S. warship brought them to the verge of war.

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Mr. Obama's effort to seek improved relations has been a theme throughout his presidency, and Tehran and Washington are now, uneasily, on the same side in at least one Middle East conflict. U.S. warplanes are pounding Islamic State targets in support of Iraqi troops and Shia militias, seeking to roll back the nascent caliphate declared by Sunni extremists in western Iraq and Syria. On the ground, Iranian advisers and special Revolutionary Guard forces are helping in the same offensive.

Both Iran and the United States insist there is no communication, let alone military co-ordination but the common military campaigns coupled with intensive ongoing talks in Lausanne bespeak a far different relationship than the decades of enmity.

Mr. Netanyahu moved quickly to torpedo the as-yet unfinished deal. The Israeli leader, who has the ear of U.S. Republicans controlling both houses of Congress, said the countries negotiating with Iran must add a new, non-negotiable condition – that Tehran recognize Israel's right to exist.

Congress can't block Mr. Obama from doing a deal with Tehran. But it can refuse to lift sanctions, which would effectively undermine any agreement by denying Tehran the benefit it bargained for.

If Republicans opt to heed Mr. Netanyahu's new condition – that any big power nuclear pact with Tehran must include "clear and unambiguous Iranian recognition of Israel's right to exist," the final pact may be dead on arrival.

Speaker John Boehner, the Ohio Republican who stirred the enmity between Mr. Obama and the Israeli leader by inviting the latter to give a speech to Congress during his campaign for re-election, quickly denounced the deal. "What bothers me is it looks like the administration is so hungry for a deal just to have a deal so they can say they have a deal," Mr. Boehner said from Jerusalem. "The rest of the world wants something real out of this."

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Even moderate Republicans like South Carolina's Sen. Lindsay Graham made clear there was no mood in Congress to accept Mr. Obama's assurances. "We simply cannot take President Obama's word that it is this or war."

The unfinished nuclear pact was being sucked into the partisan maelstrom U.S. politics as well as the Republican race for the party's 2016 nomination.

Former Florida governor Jeb Bush – undeclared but nevertheless a front-runner in the race – accused Mr. Obama of backing a pact that would legitimize rather than deny Tehran a path to nuclear weapons. "I cannot stand behind such a flawed agreement," he said, undeterred by the reality that no agreement is yet in final form.

Scott Walker, the governor of Wisconsin and another undeclared candidate at the front of the Republican race for presidential nominee was even more shrill. "Obama's dangerous deal with Iran rewards an enemy, undermines our allies and threatens our safety," he tweeted.

By comparison, some of the arch-conservative forces in Tehran seemed measured in their reaction, signalling cautious willingness to see the final deal before making a judgment.

At Friday prayers at Tehran University, the traditional podium for Supreme Leader Ayatollah Ali Khamenei to deliver the over-riding view of the theocracy, a senior cleric widely seen as a hardliner, Mohammad Emami-Kashani, praised the Iranian negotiators as "firm, wise and calm," he said, adding: "The Supreme Leader supports these representatives."