Mohammad Khatami, who won presidential elections in 1997 and 2001 with landslides, gave the strongest signal yet on Monday that he was considering running in this year's race for the Iranian presidency.

Khatami worked for political and social change during his eight years in office but hardliners in charge of major levers of power in the Islamic Republic blocked many of his reforms, costing Khatami some key supporters, such as students.

If he chooses to run, Khatami can expect to face Mahmoud Ahmadinejad, who came to power in 2005 pledging a return to revolutionary principles and promising to spread Iran's oil wealth more fairly.

Ahmadinejad has faced mounting criticism over inflation, which climbed to almost 30 percent last year, and also opposition in particular from reformists for his fiery foreign policy speeches that they say have further isolated Iran.

Khatami said that either he or Mirhossein Mousavi, another pro-reform politician, would become a candidate for the presidency, the ISNA news agency quoted him as saying at a gathering in Elam province.

"I would like to tell all reformists and those not included in the reformist front but who would want a change in the present conditions ... with God's help, between me and engineer Mirhossein Mousavi one will become a candidate soon," he said.

Mousavi was prime minister after the revolution, holding the post between 1981 and 1989. The post was scrapped after he left office.

Reformists once held the presidency, parliament and major municipal councils, but now control no major posts. Even when they did, other major levers of power were beyond their control and slammed the brakes on their reforming efforts.

Iran has multiple checks and balances, with ultimate power lying with Supreme Leader Ayatollah Ali Khamenei.

Although Ahmadinejad has faced mounting criticism for his economic management, hurt further by falling oil prices, analysts say much will depend on whether he retains the support of Khamenei, who has in recent months publicly praised him.

Ahmadinejad may also be able to call on the support of Iranians in poorer and particularly rural areas where the impact of his spending has been most obvious, analysts add.

Khatami has said anyone running for president would have to make sure he had the necessary powers to implement policies. Analysts say he would likely leave any final announcement till the last minute before the June 12 poll.

Although many of his reforms were blocked, such as a law to ease press restrictions, the media did become more vibrant during Khatami's term, even if many newspapers were banned, and some social strictures did loosen.

Ties with the West also improved during Khatami's term but they have deteriorated since Ahmadinejad came to power.

Some of Khatami's main supporters became disillusioned with him by the end of his presidency, saying he should have done more to push through change. Students, who were once at the vanguard of the reform movement, have now fallen largely silent.