The powers see the deal as a way to remove much of Iran's low-enriched uranium stockpile to minimize the risk of this being used for atomic bombs, while Iran would get specially processed fuel to keep its nuclear medicine program running.
But the proposal broke down over Iran's insistence on doing the swap only on its territory, rather than shipping its LEU abroad in advance, and in smaller, phased amounts, meaning no meaningful cut in a stockpile which grows day by day.
"In a telephone conversation with his Venezuelan counterpart, Ahmadinejad agreed in principle to Brazil's mediation over the nuclear fuel deal," Fars said, quoting a statement issued by Ahmadinejad's office.
The pact conceived in talks conducted by the UN nuclear watchdog last October required Iran to ship 1,200 kg (2,646 lb) of its LEU, enough for one atom bomb if enriched to high grade, to Russia and France for conversion into fuel for the Tehran Research Reactor, which makes isotopes for cancer treatment.
The three powers have ruled out rewriting the deal's conditions as the Islamic Republic demands.
The United States is lobbying UN Security Council members, to back a fourth round of international sanctions on Iran in the coming weeks, to press it into curbing uranium enrichment.
Iran says its nuclear energy program is designed to generate electricity only but its failure to declare sensitive atomic activity to the UN watchdog and continued restrictions on UN inspections have undermined confidence abroad.
Some nonpermanent UN Security Council members such as Brazil and Turkey are trying to revive the fuel deal with Iran in an attempt to stave off further sanctions against Tehran.
Brazil says it favors reviving a mooted compromise in which Iran could export its uranium to another country in return for nuclear fuel Iran says it needs to keep the Tehran reactor running.
It was not clear whether Ahmadinejad had agreed for the fuel swap to take place in a third country. If so, it will be a major shift in Iran's stance against the idea.
"Ahmadinejad also said technical issues (over the deal) should be discussed in Tehran," Fars reported.
Gala Riani, analyst for IHS Global Insight Middle East, said Iran "wanted to be seen" as not having closed the door to negotiations on the nuclear fuel swap.
But she said it remained to be seen whether Wednesday's announcement by Tehran was a real attempt to try and reach a solution on the issue.
"Unless Iran proposes some significant concessions the likelihood (of a deal) is low," Riani told Reuters.
Iran started enrichment to 20 percent fissile purity in February, up from 5 percent, to create fuel for the research reactor itself, bring Iran closer to levels needed for producing weapons-grade material -- uranium refined to 90 percent purity.
In a speech to a Nuclear Non-proliferation Treaty (NPT) review conference at the United Nations, US Secretary of State Hillary Clinton said on Monday that Iran's nuclear ambitions put the world at risk and called on nations to rally around US efforts to finally hold the Islamic Republic to account.
The five permanent members of the Security Council -- the United States, Britain, France, Russia and China -- along with Germany are in talks over a broader sanctions resolution against Iran.
Russia and China, veto-wielding members of the Security Council, have said they are willing to give Turkey and Brazil more time to resuscitate the nuclear fuel deal.
Brazilian Foreign Minister Celso Amorim has called on Tehran and world powers to show "flexibility" in order to resolve the nuclear standoff, while stressing that Iran must pride the West with proof that its nuclear program is for peaceful purposes only.
Dudi Cohen contributed to the report