American Marconi Wireless News - US says wants deal with Iran, but not 'at any price'

Rubio was in Bahrain as part of a regional tour to reassure Gulf partners hit hard by Iran during the Middle East war, which began on February 28 with a massive US-Israeli campaign of strikes against the Islamic republic.

The United States and Iran have signed a preliminary deal to end the conflict, embarking on negotiations expected to touch on thorny issues including Tehran's nuclear programme, sanctions relief and global energy flows through the Hormuz.

But the Gulf and Israel also have longstanding concerns about Iran's support for proxies in the region and its missile programme, and it remains unclear whether those topics will be addressed in the talks.

After meeting with Rubio on Thursday, foreign ministers from the Gulf Cooperation Council emphasised that "lasting regional peace and security requires addressing the full spectrum of Iran's threats, including its ballistic missiles, drones and support of proxies".

Earlier, Rubio had acknowledged that while the US wants "a deal, we don't want a deal at any price".

"We want to ensure... that there is no part of this deal that's undertaken that in any way undermines the security, the stability or the prosperity of any of our partners in the Gulf region," he added.

- Hormuz fees -

Rubio also sought to reassure the energy-rich Gulf states that the Hormuz strait, which they have relied on for decades to export oil and liquefied natural gas, would remain toll-free.

Iran imposed a blockade of the strait during the war, sparking a global economic shock, and has since said it plans to introduce what it terms maritime service fees, with the Revolutionary Guards on Thursday warning that any unauthorised crossings would be "dealt with".

The US and its allies have flatly rejected the introduction of fees or tolls, with Rubio reiterating Washington's position that Hormuz should be considered an international waterway and therefore not subject to charges.

"International waterways do not belong to any nation state. This is a foundational principle in the world today, without which the world would be in total chaos," he said.

The Gulf ministers, in their joint statement, also insisted that "free, unconditional and unrestricted navigation" of the strait was essential to the region.

Hormuz is a narrow stretch of water between Iran and Oman that leads to the Arabian Sea and the Indian Ocean, making it a chokepoint for crucial energy shipments out of the Gulf.

At Thursday's Gulf meeting with Rubio, Oman's top diplomat Badr Albusaidi said plans for Hormuz "do not entail the imposition of any transit fees" -- despite his government and Iran saying Tuesday that they were studying costs to be charged for services provided in the strait.

The memorandum of understanding signed last week by Tehran and Washington stipulated that commercial ships may transit the strait free of charge for the next 60 days.

It is unclear what arrangements will be in place after that period.

On Wednesday, Oman released a map of a new temporary shipping route running close to its coast. It said the path through the strait was coordinated with the International Maritime Organisation, a UN agency responsible for marine safety.

Iran later appeared to denounce the new corridor in a statement by the Revolutionary Guards, but did not refer to Oman specifically.

The British maritime security agency UKMTO said Thursday that a cargo ship in the Hormuz was "hit on the starboard side by an unknown projectile, causing damage to the bridge", reporting no casualties.

It said the incident occurred just 7.5 nautical miles (14 kilometres) off Oman's coast.

- 'Declaration of America's defeat' -

Iran has emerged emboldened from the war, vowing not to relinquish control of Hormuz and calling its initial deal with Washington to stop the fighting "a declaration of America's defeat".

President Donald Trump met with NATO chief Mark Rutte at the White House on Wednesday and said the United States was "doing great" in the negotiations.

Trump also asked Congress for nearly $88 billion in supplemental funding, mostly to cover the cost of the war, just a day after Congress called on him to end the conflict unless lawmakers explicitly authorise further military action.

Iran slammed NATO on Thursday after Rutte noted its support for the US, with foreign ministry spokesman Esmaeil Baqaei accusing the transatlantic bloc of "complicity" in an "unlawful war".

Rubio and mediator Pakistan said technical talks between the US and Iran were expected to resume in the coming days following a first round in Switzerland.

P.M.Smith--AMWN