By Samia Nakhoul and Parisa Hafezi
DUBAI, Sept 22 (Reuters) - Iran and the United States hinted on Tuesday at the prospect of reviving negotiations to end their conflict, with the presidents of both countries due at the UN General Assembly in New York.
The event would be the first attended by Donald Trump and Masoud Pezeshkian since Trump launched "Operation Epic Fury" against Iran in February, alongside Israel. Trump had said on Sunday he would be open to a meeting with the Iranian president.
A senior Iranian official said there were no plans for the two leaders to meet directly, but that Iran's delegation had full authority to revive talks.
Iran could reopen the Strait of Hormuz to Gulf shipping within seven days if the US fulfilled Tehran's demands to ease military pressure and lift an American blockade on Iranian ports, the Iranian official said, adding that Iran had conveyed its latest proposal to Washington via mediators last week.
"The US needs to announce that it wants to resolve the issue diplomatically, make that official, and then agree on a timeline for how the process will move forward," the official said. "The UN General Assembly is a golden opportunity for the US to return to diplomacy."
Secretary of State Marco Rubio told NBC's "Today" show the US was open to speaking with the Iranians, "especially if it has the prospects of leading to something positive and ultimately achieving the goal of what this is all about".
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 just weeks after it was signed by Trump and Pezeshkian.
Asked by Fox and Friends about the prospect of a meeting between the presidents, Rubio said of Trump: "He's a businessman who comes from the world of practicality and common sense. And common sense tells you there's no harm in engaging and talking to someone."
REMINDERS OF HARDLINE POSITIONS
But Rubio also noted that Pezeshkian is subordinate under Iran's ruling system to Supreme Leader Ayatollah Mojtaba Khamenei, "and the supreme leader is a radical Shia cleric and we need to remember that when we talk".
"The central issue here is Iran is run by lunatic clerics," Rubio told Fox. "These people can never have nuclear weapons."
In a reminder of Iran's firm position so far, Parliament Speaker Mohammed Baqer Qalibaf, who headed Iran's negotiating team at previous talks, said on Tuesday that Iran would never surrender: "Trump must understand that he cannot impose his power on the Iranian people and its armed forces."
Trump is 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 the Strait of Hormuz but wary of giving their longstanding rival Iran too much power. All apart from Oman also host huge US military bases that have come under repeated Iranian attack throughout the war.
SAUDIS SEEK US SUPPORT AGAINST HOUTHIS
The biggest of them, Saudi Arabia, has been drawn deeper into the war this month, with Houthi fighters aligned to Iran advancing in Yemen, routing forces of a Saudi-backed government there and threatening Saudi oil exports through the Red Sea.
There was some relief on oil markets on Tuesday, after sources told Reuters that Saudi Arabia had restarted operations at its East-West Pipeline and could resume exports within hours, albeit at reduced volume, from the Red Sea port of Yanbu. [O/R]
The pipeline, Saudi Arabia's main alternative route for exports to bypass wartime disruption in the Strait of Hormuz, was shut down after attacks this month that Riyadh blamed on Iranian allies in Iraq. [O/R]
The Houthis have routed Saudi-supported government forces along the Red Sea and the Bab el-Mandeb Strait at its mouth, and have attacked Saudi Arabia directly with missiles and drones. The fighters are now pushing to seize the strategic heights of the Kahboub Mountains that overlook the Red Sea coast.
The US, which bombed the Houthis for two months last year, has so far rebuffed repeated pleas from Saudi Arabia's Crown Prince Mohammed bin Salman to rejoin the fight. The New York Times reported that Trump called off US strikes against the Houthis on Sunday at the last minute, after troops had already begun loading bombs onto planes.
Asked why Washington had so far held back from striking the Houthis, Rubio said: "Ultimately, if it comes down to it, the United States will always stand with Saudi Arabia and support them because we have an agreement with them to do so.
"That said, that is a very dangerous and complex conflict that pre-exists... We have a history with the Houthis as well, and that's something we don't want to see impacted either."
QATARI PROPOSAL ON THE TABLE
On the table at the Gulf states' meeting with Trump is a Qatari proposal for a framework to bring Iran and the Arab Gulf states into a common security architecture, regional sources said. One source said Iran was reviewing the proposal.
Speaking at a Qatar Economic Forum in New York on Sunday, Qatari Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani said any such arrangement would need to provide security guarantees for the Gulf states and expand economic interdependence with Iran.
"Lasting security cannot be built through repeated cycles of escalations and retaliation, or arrangements that leave any state permanently exposed to insecurity," Sheikh Mohammed said.
(Reporting by Reuters Gulf bureauxWriting by Samia Nakhoul and Kevin LiffeyEditing by Peter Graff and Gareth Jones)
