Yair Lapid: "Destroying Iran's oil industry would collapse its economy and ultimately bring down the regime. Netanyahu was afraid and stopped it."
The president told Israel of his decision earlier in April, according to the report, prompting Prime Minister Benjamin Netanyahu's Washington visit.
Iran and the US are due to hold a second round of talks in Oman on Saturday over Tehran's escalating nuclear program, with President Donald Trump threatening military action if there is no deal.
The US plans to cut its troop presence in Syria by half, consolidating bases as part of a broader regional military review.
Khamenei said Tehran retains a "very pessimistic" overall view of the US and should not tie its national affairs to nuclear negotiations.
Iran's "hobbled economy" is likely to keep them at the negotiating table, the Wall Street Journal reported on Sunday.
Trump, who has threatened military action if no deal is reached on halting Iran's nuclear program, told reporters aboard Air Force One that he met with advisers on Iran and expected a quick decision.
KNOW COMMENT: What is the threshold for a deal on Iran’s nuclear ambitions?
The US and Iran are set for talks in Oman, as President Trump threatens military action if Iran doesn't limit its nuclear program, while US troops remain stationed across the Middle East.
Trump warned Iran to abandon its nuclear program or face harsh consequences.