Iran has warned that its response to a potential U.S. military attack would be expansive and decisive, as Israel kills at least two Palestinians in Gaza, amid escalating tensions throughout the Middle East.

On Thursday, Iran threatened to strike US bases and aircraft carriers immediately in response to any attack, after US President Donald Trump said that time was running out for Tehran but also said he was open to talks, The Caspian Post reports, citing foreign media.

As Washington escalated their rhetoric and Tehran issued stark warnings, the European Union blacklisted Iran’s Revolutionary Guards as a 'terrorist organisation'.

UN General Secretary General Antonio Guterres urged a return to nuclear negotiations to "avoid a crisis that could have devastating consequences in the region".

He said the United States was in contact with Iranian officials and left open the possibility of talks, after earlier cautioning that time was "running out" as Washington deploys a large naval force to the region.

When asked whether he would hold talks with Iran, Trump told reporters: "I have had and I am planning on it.”

"We have a group headed out to a place called Iran, and hopefully we won’t have to use it," he added, speaking to the media at the premiere of a documentary about his wife, Melania.

Meanwhile, in Gaza, Israel killed at least two Palestinians in an air strike on Maghazi refugee camp, health officials said, in the latest violence rattling a fragile ceasefire as Hamas and Israel looked to implement the second phase of the US-brokered Gaza peace plan.

The Gaza health ministry said Israeli airstrikes, tank shelling and gunfire have killed at least 490 people since the truce took effect in October after two years of war that destroyed the Palestinian enclave.