Iran and Israel traded strikes on Tuesday, as the Middle East war showed no sign of de-escalation after US President Donald Trump signalled "very good talks" to end the three-week conflict.
The war, sparked by US-Israel attacks on Iran that killed its supreme leader, has upended global energy markets, roiled the world economy, and spiralled throughout the region -- even dragging in safe-haven Gulf nations.
Israel's army said it had conducted a "large wave" of airstrikes across several areas of Iran, which had earlier launched a "direct hit" on a building in an upscale area of Tel Aviv.
AFP images showed rubble-strewn streets and the side of a three-storey building in Israel's commercial hub in ruins, as first responders scrambled to assist at least four people lightly injured at four different locations.
Earlier, Iranian media reported US-Israeli warplanes had struck two gas facilities and a pipeline, hours after Trump stepped back from his threat to attack energy sites, citing negotiations to end the war.
Trump on Monday said his administration was speaking with an unidentified "top person", as he extended by five days a deadline to hit Iran's power plants.
But Tehran's parliamentary speaker, Mohammad Bagher Ghalibaf said "no negotiations" were underway, accusing Trump of seeking "to manipulate the financial and oil markets."
As uncertainty swirled about diplomatic efforts to end the war, Gulf nations Bahrain, Kuwait, the United Arab Emirates and Saudi Arabia said they intercepted renewed drone and missile attacks on Tuesday.
- 'Friendly countries' -
There are no formal diplomatic relations between Washington and Tehran, and Trump's suggestion that there had been progress in talks was met with a swift denial from Iran.
But Iran's foreign ministry acknowledged that messages had been relayed by "some friendly countries" indicating a "US request for negotiations aimed at ending the war".
Pakistan's Prime Minister Shehbaz Sharif said Monday he spoke with Iran's President Masoud Pezeshkian, promising Islamabad's help to bring peace to the region.
And Egypt's Foreign Minister Badr Abdelatty already called his Iranian counterpart Araghchi and Trump's envoy Steve Witkoff on Sunday and Monday.
US media outlet Axios reported US negotiators Witkoff and Jared Kushner may meet an Iranian delegation for talks in Pakistan as soon as this week, with Vice President JD Vance possibly joining.
Traditional mediator Qatar said Tuesday it "supports all diplomatic efforts" to end the war.
The US State Department announced that Secretary of State Marco Rubio would meet G7 counterparts in France on Friday to discuss Iran, his first foreign trip since the war began.
- 'There's nothing left' -
Israel meanwhile stepped up its campaign against the Iran-backed Hezbollah militant group in Lebanon, saying its military would take control of south Lebanon up to the Litani river, around 30 kilometres (20 miles) from the border.
Israeli pounded Beirut's southern suburbs throughout the night while a strike on Bshamoun, south of the capital, killed two people on Tuesday, according to Lebanon's health ministry.
"There's nothing left. It's all burned or destroyed... No walls, the windows are gone, the facade is gone, all my hard work has been lost," said Abbas Qassem, 55 from Bshamoun, weeping at the damage to his flat.
In Beirut, AFP images showed smoke billowing from gutted buildings, as rescuers picked through the rubble and twisted metal.
Lebanon was pulled into the Middle East war when Hezbollah began firing rockets into Israel on March 2 to avenge the killing of Iran's supreme leader Ayatollah Ali Khamenei.
Israel's attacks in Lebanon have killed more than 1,000 people, according to Lebanon's health ministry, and displaced more than a million people.
Underscoring the war's broad impact, the UAE defence ministry said that a Moroccan contractor with the Emirati military was killed in Bahrain in an Iranian attack.
The war has killed at least 3,230 Iranians, including 1,406 civilians, according to the US-based Human Rights Activists News Agency. AFP cannot access strike sites nor independently verify tolls in Iran.
Qatar said Tuesday the war had caused the "breakdown of the security system in the Gulf region."
In unusually strong comments, German President Frank-Walter Steinmeier said the US-Israeli war on Iran was "a politically disastrous mistake".
- 'Trust has been destroyed' -
Before again coming under fire on Tuesday, Iran's neighbours had breathed a sigh of relief when Trump stepped back from a threat to "obliterate" Iran's power plants unless Tehran fully reopened the strategic Strait of Hormuz shipping lane.
Tehran had vowed to deploy naval mines and strike power and water infrastructure across the region in retaliation, threatening to escalate an energy crisis of already historic proportions.
Since the start of the US-Israeli attacks, Tehran has retaliated by throttling traffic through the Strait of Hormuz, sending oil and gas prices soaring and fuelling fears of higher inflation and weaker global growth.
Oil prices, which had tumbled after Trump's comments, rebounded slightly in Tuesday trade, with Brent back above $100 a barrel.
Although Iran's chokehold on the strait gives it leverage in potential negotiations it did not have before the war, analysts remained cautious.
"I'm very sceptical (about the talks) because trust has been completely destroyed and the positions of the warring parties are further apart than ever," David Khalfa, a Middle East specialist at the Jean-Jaures Foundation, a Paris-based think-tank, told AFP.
"The margin for manoeuvre on both sides is very limited," he added.
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