WASHINGTON, May 4 (Reuters) - President Donald Trump said on Monday he looks forward to seeing China’s Xi Jinping later this month, saying he will remind his rival that the United States is leading in artificial intelligence as the two sides navigate tensions over trade and technology.

(Reporting By Jarrett Renshaw; editing by Costas Pitas)

By Phil Stewart and Idrees Ali

WASHINGTON, May 4 (Reuters) - The U.S. military said on Monday it destroyed six Iranian small boats and intercepted Iranian cruise missiles and drones fired by Tehran as it sought to thwart a new U.S. naval effort to open shipping through the Strait of Hormuz.

U.S. President Donald Trump launched the operation, called Project Freedom, on Monday as he sought to wrest control of the critical waterway from Iran after it effectively closed the Strait of Hormuz after the U.S. and Israel started the conflict on February 28.

The latest developments in the Middle East war:

- Iran 'not even started' -

Iran's chief negotiator in talks with the United States, Mohammad Bagher Ghalibaf, warned that his country had "not even started" and that US actions in the Strait of Hormuz had put shipping at risk.

- Stocks sink on rising tension -

Stocks sank across Asian exchanges as a fresh spike in Middle East tensions fanned fears over the fragile US-Iran ceasefire, and oil prices fell back slightly after gains on Monday.

- Maersk sails through Hormuz -

By Simon Lewis

May 4 (Reuters) - The United States and Gulf Arab nations are drafting a U.N. Security Council resolution designed to condemn Iran for blocking the Strait of Hormuz in response to a U.S.-Israeli bombing campaign, U.S. Ambassador to the U.N.Mike Waltz said on Monday.

Waltz said negotiations will take place this week on the resolution, which comes after permanent Security Council members Russia and China blocked a resolution last month that Washington hoped would galvanize international efforts to restore freedom of navigation of the waterway.

KEY DETAILS

May 4 (Reuters) - President Donald Trump said on Monday that South Korea should join U.S. efforts to protect ship movements near Iran, and added that Defense Secretary Pete Hegseth would hold a news conference on Tuesday with the Chairman of the Joint Chiefs of Staff Dan Caine.

(Reporting by Costas Pitas)

May 4 (Reuters) - Authorities in the United Arab Emirates' Fujairah said on Monday that a fire broke out at the Fujairah Oil Industry Zone following what they described as a drone attack originating from Iran.

Civil defence teams were deployed immediately to contain the blaze, Fujairah Media office said in a statement.

There was no immediate comment from Iran.

(Reporting by Reuters; Writing by Muhammad Al Gebaly; Editing by Susan Fenton)

By Andrew Gray and Lili Bayer

BRUSSELS, May 4 (Reuters) - European officials have been working on ways to convince Donald Trump to keep the United States in NATO despite severe tensions over the Iran war. But his abrupt move to cut U.S. forces in Germany is the latest sign that such efforts have their limits and are far from certain to succeed.

WASHINGTON, May 4 (Reuters) - U.S. Treasury Secretary Scott Bessent on Monday urged China to step up its diplomatic efforts to persuade Iran to open the Strait of Hormuz to international shipping, adding that the subject will be discussed when President Donald Trump meets with Chinese President Xi Jinping next week.

"China, let's see them step up with some diplomacy and get the Iranians to open the strait," Bessent said during a live Fox News Channel interview.

America's NATO allies put a brave face Monday on a US decision to withdraw 5,000 troops from Germany, but warned it was proof Europe needs to step up for its own security, and fast.

US President Donald Trump cast fresh doubts over the future of the alliance as he announced Washington was to scale back its largest troops contingent in Europe, after a spat with Berlin over the Iran war.

But, gathered in Yerevan, Armenia, for a meeting of the European Political Community (EPC), European leaders and Canada's Mark Carney said they were ready to step up.

By Ilze Filks

OSLO, May 4 (Reuters) - Imprisoned Iranian Nobel Peace Prize laureate Narges Mohammadi, who was taken from jail to hospital last week, requires urgent specialised medical care to treat a life-threatening heart condition, her brother told Reuters on Monday.