Israeli Prime Minister Benjamin Netanyahu clashed with Donald Trump in a furious phone call that left the Israeli leader with his 'hair on fire,' a source has revealed.

On Tuesday evening, the two leaders held a difficult and lengthy phone call where they disagreed on the way forward in the Iran war.

Netanyahu increasingly doubts further negotiations with Tehran will yield a peace deal and wants to resume military strikes, according to Israel's Channel 12.

Trump, meanwhile, wants to push harder for an agreement in which Iran abandons its nuclear weapons program before any return to war.

One source told Axios that Israel's ambassador to Washington had informed US lawmakers that Netanyahu was concerned about the call, claiming the PM's 'hair was on fire' following the tense conversation.

'Bibi is always concerned,' another source said, adding that the Israeli leader has been worried in the past during previous negotiation stages.

Trump stated he is ready to restart the war if negotiations collapse, but he remains confident an agreement will be reached.

Speaking on Wednesday at the Coast Guard Academy, he said: 'The only question is do we go and finish it up or are they gonna be signing a document. Let's see what happens.'

He later added that the US and Iran were 'right on the borderline' between getting a deal and resuming the war. 

Trump also claimed that Netanyahu 'will do whatever I want him to do' on Iran, though adding that they had a good relationship. 

The discussion between the pair came hours after the New York Times revealed that Israel, with Trump's approval, went into the war with an 'audacious' plan to install hardline former president Mahmoud Ahmadinejad as Iran's new leader after Ayatollah Ali Khamenei was killed in the opening strikes.

However, the plot collapsed on day one when Ahmadinejad was wounded by an Israeli strike on his Tehran home meant to free him from house arrest, and he hasn't been seen since.

Ahmadinejad, who had fallen out with the Ayatollah, was known during his 2005 to 2013 presidency for calling to 'wipe Israel off the map.' 

He also backed Tehran's nuclear program, and violently crushed civilian dissent.

‘The failed plans for Ahmadinejad just further proves that there is no good leader within the current ranks of their government,' a US official involved in the US-Iran negotiations told the Daily Mail.

On Wednesday, Iran's foreign ministry said that negotiations were ongoing 'based on Iran's 14-point proposal,' and that Pakistan's interior minister was in Tehran to help the mediation.

The ministry said that in order for agreements to be made, the US would have to end its 'piracy' against Iranian ships and agree to release frozen funds, while Israel would have to end its war in Lebanon.

Mediators including Pakistan, Qatar, Saudi Arabia, Turkey and Egypt have been attempting to narrow the gaps in the proposal, sources told Axios.

However it remains unclear whether Iranians will shift their position over their nuclear program.

On Wednesday, Iran's Revolutionary Guards warned that the Middle East war will extend beyond the region if the US and Israel resume attacks on the Islamic republic.

'If the aggression against Iran is repeated, the promised regional war will this time spread far beyond the region, and our devastating blows will crush you,' the Guards said in a statement on their website Sepah News.

The IRGC also warned that Iran had not yet used 'all the capabilities of the Islamic Revolution' against the West.

The threat came after Trump claimed on Tuesday that Iran's leaders are 'begging' for a deal, adding that a new US attack would happen in coming days if no agreement was reached.  

'You know how it is to negotiate with a country where you're beating them badly. They come to the table, they're begging to make a deal,' he said.

'I hope we don't have to do the war, but we may have to give them another big hit. I'm not sure yet.'

Trump made his comments a day after saying he had paused a planned resumption of hostilities following a new proposal by Tehran to end the conflict.

'I was an hour away from making the decision to go today,' Trump told reporters at the White House on Tuesday.

Iran's army spokesman Mohammad Akraminia warned the Islamic republic would 'open new fronts against' the US if it resumed its attacks.

He added that Iran's military had used the ceasefire as an opportunity 'to strengthen its combat capabilities.'

Trump offered a deadline of several days for resuming strikes if a deal was not agreed.

'I'm saying two or three days, maybe Friday, Saturday, Sunday, something, maybe early next week, a limited period of time,' he said.

The United States has been struggling to end the war it began with Israel nearly three months ago. 

Trump has repeatedly said during the conflict that a deal with Tehran was close, and similarly threatened heavy strikes on Iran if it did not reach an accord.

Speaking to reporters at a White House briefing, Vance acknowledged difficulties in negotiating with a fractured Iranian leadership. 

'It's not sometimes totally clear what the negotiating position of the team is,' he said, so the US is trying to make its own red lines clear.

He also said one objective of Trump's policy is to prevent a nuclear arms race from spreading in the region.

Ebrahim Azizi, head of the Iranian parliament's national security committee, said on X that Trump's pausing of an attack was due to the realization that any move against Iran would mean 'facing a decisive military response.'

Tehran's latest peace proposal appeared little changed from Iran's previous offer, which Trump rejected last week as 'garbage.'

The US president is under intense political pressure at home to reach an accord that would reopen the Strait of Hormuz - a key route for global supplies of oil and other commodities. 

Gasoline prices remain high and Trump's approval rating has plummeted with congressional elections looming in November.

The conflict has caused the worst-ever disruption to global energy supplies, blocking hundreds of tankers from leaving the Gulf while damaging energy and shipping facilities across the region.