By Humeyra Pamuk, Phil Stewart and Parisa Hafezi

WASHINGTON/DUBAI (Reuters) -Israel launched an attack on Iranian soil on Friday, sources said, in the latest tit-for-tat exchange between the two arch foes, whose decades of shadow war has broken out into the open and threatened to drag the region deeper into conflict.

Iranian media reported explosions, but an Iranian official told Reuters those were caused by air defense systems. State media said three drones over the central city of Isfahan had been shot down.

Israel's leadership and the military were silent early on Friday. Iran has no plan to strike back immediately, a senior Iranian official told Reuters, while state media had an initially subdued response to the attack.

The United States received notification before Israel's attack, a source familiar with the situation told Reuters, which came days after Iran launched an unprecedented strike on Israel with a barrage of drones and missiles. Most of those were shot down.

Washington and other global powers had pressed Israel not to respond, or to ensure any further retaliation was limited to prevent a broader conflagration after the latest surge in violence was sparked by the air strike on the Iranian embassy compound in Damascus on April 1 that was blamed on Israel.

That strike came against the backdrop of Iran's support for the Palestinian Hamas militant group, whose assault into Israel on Oct. 7 triggered Israel's invasion of Gaza.

The senior Iranian official cast doubt on whether Israel was responsible.

"The foreign source of the incident has not been confirmed. We have not received any external attack, and the discussion leans more towards infiltration than attack," the Iranian official said on condition of anonymity.

IRAN REACTION SUBDUED

In most official comments and news reports, there was no mention of Israel and state television carried analysts and pundits who appeared dismissive about the scale.

An analyst told state TV that mini drones flown by "infiltrators from inside Iran" had been shot down by air defenses in Isfahan.

Shortly after midnight, "three drones were observed in the sky over Isfahan. The air defense system became active and destroyed these drones in the sky," Iranian state TV said.

Senior army commander Siavosh Mihandoust was quoted by state TV as saying air defense systems had targeted a "suspicious object".

Iranian President Ebrahim Raisi had warned Israel before Friday's strike that Tehran would deliver a "severe response" to any attack on its territory.

Iran told the United Nations Security Council on Thursday that Israel "must be compelled to stop any further military adventurism against our interests" as the U.N. secretary-general warned that the Middle East was in a "moment of maximum peril."

Shares and bond yields sank in Asia trade while safe-haven currencies, gold and jumped. futures surged as much as 4.2%% on concerns Middle East supply could be disrupted before shedding some gains. MSCI's broadest index of Asia-Pacific shares dropped 2%, after earlier diving as much as 2.6%, and U.S. stock futures pointed 1% lower. [MKTS/GLOB]

NUCLEAR SITES UNDAMAGED

The International Atomic Energy Agency said there was no damage to Iran's nuclear sites in the alleged attack by Israel on Iran, confirming Iranian reports.

Tehran says its nuclear work is peaceful, but the West believes is aimed at building a weapon. The Natanz nuclear site, the centerpiece of Iran’s uranium enrichment program, is in Isfahan province.

Iran closed its airports in Tehran, Shiraz and Isfahan after the attack and also cleared flights from the western portion of its airspace for a few hours after the attack, according to FlightRadar24. By 0445 GMT the airports and airspace had reopened.

The U.S. Embassy in Jerusalem restricted U.S. government employees from travel outside Jerusalem, greater Tel Aviv and Beersheba, "out of an abundance of caution."

In a statement on its website, the embassy warned U.S. citizens of a "continued need for caution and increased personal security awareness as security incidents often take place without warning."

Israel's assault on Gaza began after Hamas Islamists attacked Israel on Oct. 7, killing 1,200, according to Israeli tallies. Israel's military offensive has killed over 33,000 Palestinians in Gaza, according to the Gazan health ministry.

Iran-backed groups have declared support for Palestinians, launching attacks from Lebanon, Yemen and Iraq, raising fears the Gaza conflict could grow into a wider regional war.