The United States has significantly scaled down a planned joint military exercise with Israel most likely because of disagreements on how to deal with Iran's nuclear ambitions, Time magazine has reported on its website

Citing "well-placed sources in both countries", the magazine said Washington was slashing by more than two-thirds the number of US troops going to Israel, and reducing the number and potency of missile interception systems that will be used in the exercise dubbed Austere Challenge 12, which is scheduled for October.

Instead of approximately 5,000 US troops, the Pentagon will send between 1,200 and 1,500. Patriot anti-missile systems will arrive in Israel as planned, but the crews to operate them will not, according to the report.

Instead of two Aegis Ballistic Missile Defense warships, the new plan calls for sending just one, and even the remaining vessel is listed as a "maybe", the report said.

Basically what the Americans are saying is, "We don't trust you," a senior Israeli military official is quoted by Time as saying.

Time said the official explanation was budget restrictions.

But the reductions coincided with growing tensions between the administrations of President Barack Obama and Prime Minister Benjamin Netanyahu about Israel's threats to launch an airstrike on Iran over its nuclear program.

Israeli officials quoted in the country's media later on Saturday insisted the Pentagon's decision had nothing to do with any differences between Obama and Netanyahu over Iran.