US President Donald Trump has signalled that he is not inclined to authorise an immediate military strike on Iran in response to the attacks on the Saudi oil industry.

Speaking in the Oval Office ahead of an early afternoon meeting with his national security team, Mr Trump said he believes showing restraint “shows far more strength” and he wants to avoid an all-out war.

The president laid out new sanctions on the Iranian central bank and said the easiest thing to do would be to launch military strikes.

“I think the strong person’s approach and the thing that does show strength would be showing a little bit of restraint,” Mr Trump told reporters during a meeting with Australian Prime Minister Scott Morrison.

“Much easier to do it the other way and Iran knows that if they misbehave they are on borrowed time.”

Donald Trump and Australian Prime Minister Scott Morrison
Mr Trump was meeting with Australian Prime Minister Scott Morrison (AP/Susan Walsh)

Mr Trump spoke just before he gathered his national security team at the White House to discuss how to respond to the weekend drone and missile attack on oil facilities in Saudi Araba that the administration has blamed on Iran.

If he decides against a US strike, it would mark the second time in recent months that he has pulled back from a major military action against Iran that many Pentagon and other advisers fear could trigger a new Middle East war.

In June, after Iran shot down an American surveillance drone, Mr Trump initially endorsed a retaliatory military strike then abruptly called it off because he said it would have killed dozens of Iranians.

US Iran
(PA Graphics)

On Friday, he left the door open for a later military response, saying people thought he would attack Iran “within two seconds” but, he said, he has “plenty of time”.

During the meeting, US National Security leaders will present Mr Trump with a broad range of military, economic and diplomatic options to consider as he decides how the US should respond to what administration officials say was an unprecedented Iranian attack on Saudi oil facilities.

The options will include an updated list of potential military strike targets inside Iran. But Pentagon leaders will also warn that military action against the Islamic Republic could escalate into war.

Any decision may depend on what kind of evidence the US and Saudi investigators are able to provide proving that the cruise missile and drone strike was launched by Iran, as a number of officials, including US secretary of state Mike Pompeo, have said.

Iran has denied involvement and warned the US that any attack will spark an “all-out war” with immediate retaliation from Tehran.