Iran threatens U.S., appears to admit setback in Iraq war

NICOSIA, Cyprus Iran indicated Monday it had suffered asignificant setback in its land war with Iraq and pledged toretaliate against the United States for naval attacks in the PersianGulf in which several Iranians were killed or wounded.

Iran's Supreme War Support Council accused the United States andthe Soviet Union of taking Iraq's side in the gulf war.

Tehran Radio, monitored in Cyprus, said, "Two Iranian warships,which inflicted losses on six American warships in a heroic battle,were hit by the American vessels and suffered heavy damage."

The broadcast referred also to fighting on Iraq's Faw peninsula,which Iraq said its forces recaptured …