Report says Iran and US reach outline ceasefire deal after latest attacks

The US and Iran have reached an outline agreement to extend their ceasefire pending the approval of President Donald Trump, according to an Axios report, after Iran targeted a US air base in Kuwait in the wake of US strikes on Iranian drone operation.

According to the report by Axios, the two sides agreed on a 60-day memorandum of understanding to extend the truce and launch negotiations on Iran's nuclear programme but the plan still needed Trump's signoff.

Oil prices reversed course to trade lower after the report.

The latest attacks, while limited, highlighted the fragility of negotiations to turn the tenuous early-April ceasefire into a lasting agreement to end the three-month-old war that has killed thousands, and reopen the vital Strait of Hormuz shipping route.

US Central Command said US forces had shot down five Iranian attack drones and struck a ground control station in the port city of Bandar Abbas that was about to launch a sixth. Kuwaiti forces had then intercepted a ballistic missile fired towards the country, which hosts a large US base.

"These actions were measured, purely defensive and intended to maintain the ceasefire," a US official, who requested anonymity to speak candidly about military operations, told Reuters earlier.

The Islamic Revolutionary Guard Corps said it had targeted the US base responsible for an early-morning attack near Bandar Abbas airport and that any repeat would lead to a "more decisive response", Tasnim news agency reported.

Kuwait condemned the attack and demanded that Iran immediately halt what it called a serious escalation.

The violence, the second flare-up this week, coincided with Eid al-Adha celebrated across the region, where multiple countries have been caught up in the conflict triggered by US and Israeli attacks on Iran on February 28.

Mediator Pakistan said its foreign minister, Ishaq Dar, would meet US Secretary of State Marco Rubio in Washington on Friday, although the significance of his visit was unclear.

In Lebanon, which Iran says must be part of any overall peace deal, Israel said it had begun striking infrastructure of Hezbollah in the southern city of Tyre and had carried out a strike in the capital Beirut.