Iranis demanding that talks with the US this week be held inOman, not Turkey, and that the scope be narrowed to two-way negotiations on nuclear issues only, a regional source said on Tuesday, adding new complications to an already delicate diplomatic effort.

Iran's move to change the venue and agenda for the talks, scheduled for Friday in Istanbul, comes amid heightened tensions as the US builds up forces in theMiddle East.

Regional players have pushed for a resolution of a standoff that has led to mutual threats of air strikes and stirred fears of escalation into a wider war.

The US military on Tuesday shot down an Iranian drone that aggressively approached the Abraham Lincoln aircraft carrier in the Arabian Sea, the US military said, in an incident first reported by Reuters.

US PresidentDonald Trump, who warned on Monday that bad things would probably happen if a deal could not be reached with Iran, told reporters at the White House on Tuesday: We are negotiating with them right now. He did not elaborate and declined to say where he expected the talks to take place.

The regional diplomat with knowledge of Iran's demands said Tehran sought to change the format, they want to change the scope.

They only want to discuss the nuclear file with the Americans, while the US wants to include other topics such as the (ballistic) missiles and the activities of Iran's proxies in the region.

White House press secretary Karoline Leavitt told Fox News that talks with Iran were still scheduled to take place later this week.

Iran's foreign ministry spokesperson said consultations on the venue were still under way, Iranian Nour News reported later on Tuesday. The spokesperson said planning has been carried out to hold the negotiations in the coming days and thatTurkey, Oman and several other countries had expressed readiness to host the meeting.

A source familiar with the situation said earlier on Tuesday that Trump's son-in-law Jared Kushner was due to take part in the talks, along with US Special Envoy Steve Witkoff and Iranian Foreign Minister Abbas Aragchi.

Ministers from several other countries in the region, including Pakistan,Saudi Arabia, Qatar,Egyptand the United Arab Emirates, had also been expected to attend, but the regional source told Reuters that Tehran now wants only bilateral talks with the US.

US buildup follows street protests in Iran

The US naval buildup followsIran's violent crackdownagainst anti-government demonstrations last month.

Trump, who stopped short of carrying out threats to intervene, has since demandednuclearconcessions from Iran and sent a flotilla to its coast.

The priority of the diplomatic effort is to avoid conflict and de-escalate tension, a second regional official told Reuters earlier.

Irans leadership is increasingly worried a US strike could break its grip on power by driving an already enraged public back onto the streets, according to six current and former Iranian officials.

With tensions running high, an Iranian Shahed-139 drone flying toward the Abraham Lincoln aircraft carrier with unclear intent was shot down by an F-35 US fighter jet, the US military said.

Iran's Tasnim news agency said connection had been lost with a drone in international waters, but the reason was unknown.

US Central Command said in another incident on Tuesday, this one in the Strait of Hormuz, Iran's Islamic Revolutionary Guard Corps forces harassed a US-flagged tanker.

Two IRGC boats and an Iranian Mohajer drone approached M/V Stena Imperative at high speeds and threatened to board and seize the tanker, said Navy Captain Tim Hawkins, a spokesperson for Central Command.

Maritime risk management group Vanguard said the Iranian boats ordered the tanker to stop its engine and prepare to be boarded. Instead, the tanker sped up and continued its voyage.

Hawkins said aUS Navywarship, the McFaul, was operating in the area and escorted the Stena Imperative, which was proceeding safely.

Earlier, theUnited Arab Emirates, a highly influential Gulf Araboilproducer and close US ally, said the region cannot afford another conflict and negotiations are needed.

Gulf Arab states are worried that Iran will carry out its threat to target US bases on their territory should Trump attack the Islamic Republic again.

In June, theUnited Statesstruck Iranian nuclear targets, joining in at the close of a 12-dayIsraelibombing campaign. Since then, Tehran has said its uranium enrichment work which it says is for peaceful, not military, purposes has stopped.

Iranian sources told Reuters last week that Trump had demanded three conditions for the resumption of talks: zero enrichment of uranium in Iran, limits on Tehran's ballistic missile programme, and ending its support for regional proxies.

Iran has long said all three demands are unacceptable infringements of its sovereignty, but two Iranian officials told Reuters that its clerical rulers saw the ballistic missile programme, rather than uranium enrichment, as the bigger obstacle.

One Iranian official said there should be no preconditions and Tehran is ready to show flexibility on uranium enrichment, including handing over 400kg of highly enriched uranium, accepting zero enrichment.

Tehran's regional influence has been weakened by Israel's attacks on its proxies from Hamas inGazato Hezbollah inLebanon, the Houthis inYemenand militias in Iraq as well as by the ousting of Iran's close ally, former Syrian PresidentBashar al-Assad.

(FRANCE 24 with Reuters)

Originally published on France24