A U.S. media outlet reported on Wednesday that the White House believed it was closing in on a one-page memorandum to end the war with Iran, after U.S. President Donald Trump paused a three-day-old naval mission to reopen the Strait of Hormuz.

Reuters was unable to immediately confirm the report by the news outlet Axios, which cited two U.S. officials and two other sources briefed on the discussions.

The report said the U.S. expected Iranian responses on several key points in the next 48 hours. The U.S. State Department and White House did not immediately respond to requests for comment.

Among other provisions, Axios said, the deal would involve Iran committing to a moratorium on nuclear enrichment, the U.S. agreeing to lift its sanctions and release billions of dollars in frozen Iranian funds, and both sides lifting restrictions around transit through the Strait of Hormuz.

TRUMP'S 'PROJECT FREEDOM' PAUSED

Earlier, Trump announced a pause to "Project Freedom", a mission announced on Sunday to guide ships through the blocked strait. The mission had failed to bring about any significant resumption of traffic through the waterway, while provoking a new wave of Iranian strikes on ships in the strait and on targets in neighbouring countries.

In the latest incident, a French shipping company reported on Wednesday that one of its container ships had been struck in the strait the previous day, and that injured crew had been evacuated.

In announcing he was pausing the mission, Trump cited "great progress" in negotiations with Iran, without giving further details.

"We have mutually agreed that, while the Blockade will remain in full force and effect, Project Freedom (The Movement of Ships through the Strait of Hormuz) will be paused for a short period of time to see whether or not the Agreement can be finalized and signed," Trump wrote on social media.

Trump had launched the naval mission to guide ships through the strait after saying he was likely to reject Iran's latest proposal. The Iranian offer, made last week, calls for setting aside discussion of nuclear issues until after the war ends and the shipping dispute is resolved.

In comments on a visit to China on Wednesday, Iran's Foreign Minister Abbas Araqchi made no mention of Trump's latest remarks, but said Tehran was holding out for "a fair and comprehensive agreement".

Araqchi also said in a social media post that he had spoken by phone with the foreign minister of Saudi Arabia and had stressed the importance of diplomacy among regional states to prevent escalation.

STRAIT SHUT SINCE END OF FEBRUARY

Iran has effectively shut the strait to all shipping apart from its own since the United States and Israel launched the war on February 28. In April, Washington imposed its own separate blockade of Iranian ports.

Trump's Project Freedom mission to use the U.S. Navy to open the strait failed to persuade merchant ships that it was safe, while provoking new attacks from Iran, which said it was expanding the area under its control to include swathes of the coastline of the United Arab Emirates, on the strait's far side.

While the mission was in effect, Iranian drones and missiles hit several ships in and around the strait, including a South Korean cargo vessel that reported an explosion in its engine room.

Tehran also repeatedly struck targets in the UAE, including the only major Emirati oil port on the coast beyond the strait, which has allowed some exports without crossing through it.

For its part, the U.S. Navy had said it hit several small Iranian boats on Monday.

Following Trump's post that the mission was paused, Brent crude oil futures LCOc1 fell around 1.7%, to under $108 a barrel. O/R

The White House did not immediately reply to a request for comment on what progress had been made, or how long the pause would last. Throughout the war, Trump has cited progress in talks with Iran without evidence when announcing reversals in his military tactics.

U.S. Secretary of State Marco Rubio and other senior administration officials had said earlier on Tuesday that Iran could not be allowed to control traffic through the strait.

Days after a ceasefire paused the U.S.-Israeli bombing campaign on April 8, the United States and Iran held one round of peace talks in Pakistan. But efforts to organise a second round have so far failed, with both sides accusing the other of making unreasonable demands.

TRUMP SAYS IRAN WANTS PEACE

U.S.-Israeli attacks on Iran during the war killed thousands of people in Iran, and thousands have also been killed and a million displaced in Lebanon, which Israel invaded to root out Iran-backed Hezbollah fighters who fired across the border in support of their ally.

Dozens of people have been killed in the Gulf and Israel by Iranian fire in response.

Trump has repeatedly insisted that the war destroyed Iran's military capability. He told reporters on Tuesday in the Oval Office that Iran's military had been reduced to firing "peashooters" and Tehran wanted peace, despite its public sabre-rattling.

The conflict is putting pressure on Trump's administration ahead of crucial midterm elections in November, as rising gasoline prices hit voters' pockets.