VIENNA (Reuters) - The European Union said on Wednesday that Iranian stonewalling of a U.N. nuclear agency inquiry into suspected atom bomb research was "unacceptable", and voiced deep concern about Tehran's expanding atomic work.

In a joint statement delivered at a board meeting of the International Atomic Energy Agency (IAEA), the 27-nation bloc again said Iran must suspend its uranium enrichment work, something Tehran has repeatedly ruled out doing.

Diplomats said Sweden had tried to weaken the tone of the EU statement, delaying internal approval of the text, which was read out at the closed-door board session later than expected.

The revised version said the IAEA's latest report on Iran, which said Tehran was installing more advanced enrichment centrifuges, gave "cause for serious concern". It had initially said the report was "dismal reading", one envoy said.

The EU said there was a worrying lack of progress in a long-stalled IAEA investigation aimed at clarifying possible military dimensions to Iran's nuclear program.

Western diplomats accuse Iran of preventing progress in the investigation, refusing IAEA requests to visit the Parchin military site where inspectors suspect explosives tests relevant for nuclear arms development took place, possibly a decade ago.

Iran denies this, as well as Western allegations that it is seeking to develop the capability to make atomic bombs.

"The EU considers ... Iran's procrastination to be unacceptable," the statement said.

Three EU states - Germany, France, Britain - are part of a group of six world powers that last week resumed talks with Iran aimed at finding a diplomatic settlement to a decade-old dispute that could trigger a new Middle East war.

The other three are the United States, China and Russia.

(Reporting by Fredrik Dahl; Editing by Alistair Lyon)