Iran, US step up attacks, though release of American may signal path to climbdown

By Nayera Abdallah, Jana Choukeir and Eman Abouhassira

DUBAI, July 16 (Reuters) - Iran and the United States exchanged intensified fire on Thursday in a week-long escalation that has all but torn up last month's truce, though Iran's release of a U.S. citizen pointed towards a path to avert the resumption of all-out war.

For the first time since a memorandum of understanding paused fighting last month, the United States launched two big waves of air strikes in a single day on Wednesday, mostly on targets near the coast in southern Iran.