Trump says Iran deal near, Tehran offers Hormuz reopen

President Donald Trump says Washington and Tehran are moving toward a settlement, while a senior Iranian official said Tehran could reopen the Strait of Hormuz within days if the US eased military pressure and lifted its blockade on Iranian ports.

Trump's remarks came just hours after he repeated a threat at the UN General Assembly to annihilate Iran if it failed to strike a deal.

Speaking after a meeting with British Prime Minister Andy Burnham at the United Nations in New York, Trump said: "They want to talk to us. They have been talking to us, even today they've been talking to us, and the relationship is developing.

"But we can't let them - and they understand that - we can't let them have a nuclear weapon."

He gave no details on the talks. No face-to-face meetings between Iran and the United States are known to have taken place since July, when an agreement on an interim deal to end the war collapsed weeks after it was signed.

Earlier, in a combative speech to the UN, Trump gave no sign of readiness to compromise. He called for Iran's complete economic isolation and said he believed a deal would be done after November's midterm elections "because it doesn't make sense for them not to. They're waiting to see how I do in the midterm election."

Trump faces growing domestic discontent over the unpopular Iran war, rising energy costs and stubbornly elevated inflation.

Iran had earlier signalled a willingness to revive negotiations to end their almost seven-month-old conflict, with the presidents of both countries due at the UN for the annual gathering.

The senior Iranian official told Reuters that Tehran had conveyed its latest proposal to Washington through mediators last week and could reopen the Strait of Hormuz to Gulf shipping within seven days if its demands were met.

The official had earlier told Reuters that the US should "announce that it wants to resolve the issue diplomatically, make that official, and then agree on a timeline".

"The UN General Assembly is a golden opportunity for the US to return to diplomacy," the official said.

In a reminder of Iran's firm position so far, Parliament Speaker Mohammad Baqer Qalibaf, who headed Iran's negotiating team at previous talks, said Iran would never surrender: "Trump must understand that he cannot impose his power on the Iranian people and its armed forces."

Trump was due to meet on Tuesday with leaders of the six Gulf Arab states: Bahrain, Kuwait, Qatar, Oman, Saudi Arabia and the United Arab Emirates.

All are keen to restore shipping through Hormuz, the conduit for a fifth of global oil and gas shipments before the war, but wary of giving their longstanding rival Iran too much power.