Iran and a group of six world powers have failed to reach a deal on Tehran’s controversial nuclear programme after a meeting in Vienna, agreeing to a seven-month extension of negotiations.

The two sides are now aiming to reach an agreement by 1 March 2015 and confirm the technical details of the deal by 1 July.

The breakdown of the talks in Austria’s capital represents the second extension of negotiations since the original interim deal was hammered out in Geneva a year ago. Iran and the six countries – the US, UK, Russia, China, France and Germany – also failed to reach a deal in July.

Tehran will be allowed to access $700m a month in frozen overseas assets in the period until talks resume in March.

The two sides remain positive that a deal can be reached, despite several sticking points over Iran’s uranium enrichment programme, which foreign powers suspect may be aimed at producing nuclear weapons.

Tehran maintains that its nuclear programme is being development for peaceful purposes, an assertion the International Atomic Energy Agency (IAEA) has been unable to confirm.

“We intend to build on the current momentum in order to complete these negotiations within the shortest possible time,” Iranian Foreign Minister Mohammad Javad Zarif and EU envoy Catherine Ashton said in a joint statement.