Iran and the US both signalled a breakthrough in ceasefire talks on Thursday, with US President Donald Trump saying an agreement to end the war and start wider negotiations could be signed over the weekend, while Iranian media said the chances of a deal were “high”.

"We just made a great settlement of the war with Iran," Trump told reporters in the Oval Office on Thursday. He added that "subject to finalisation of documents, which should get done, over the next few days, [we will] probably have a signing, maybe in Europe.”

Trump now has an established pattern of saying a deal is at hand only for expectations to fizzle and fighting to flare up again.

However, Iran’s semi-official Fars News agency reported on Thursday that the text the US accepted was already approved by Iran and that Tehran is likely to seal the agreement. The report added that no formal response has been delivered yet.

Israeli Prime Minister Benjamin Netanyahu's office also issued a muted statement suggesting a deal was within reach.