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.