U.S. President Donald Trump said on Thursday a major conflict with North Korea is possible in the standoff over its nuclear and missile programs, but he would prefer a diplomatic outcome to the dispute.

"There is a chance that we could end up having a major, major conflict with North Korea. Absolutely," Trump told Reuters in an Oval Office interview ahead of his 100th day in office on Saturday. Nonetheless, Trump said he wanted to peacefully resolve a crisis that has bedeviled multiple U.S. presidents, a path that he and his administration are emphasizing by preparing a variety of new economic sanctions while not taking the military option off the table.

"We'd love to solve things diplomatically but it's very difficult," he said.

In other highlights of the 42-minute interview, Trump was cool to speaking again with Taiwan's president after an earlier telephone call with her angered China.

He also said he wants South Korea to pay the cost of the U.S. THAAD anti-missile defence system, which he estimated at $1 billion US, and intends to renegotiate or terminate a U.S. free trade pact with South Korea because of a deep trade deficit with Seoul.

Asked when he would announce his intention to renegotiate the pact, Trump said: "Very soon. I'm announcing it now."

Just a few hours after the interview was circulated, South Korean officials expressed surprise at these comments.

Trump also said he was considering adding stops to Israel and Saudi Arabia to a Europe trip next month, emphasizing that he wanted to see an Israeli-Palestinian peace. He complained that Saudi Arabia was not paying its fair share for U.S. defence.

Trump: 'I thought it would be easier'0:29

Lavishes praise on Xi

Trump said North Korea was his biggest global challenge. He lavished praise on Chinese President Xi Jinping for Chinese assistance in trying to rein in Pyongyang. The two leaders met in Florida earlier this month.

"I believe he is trying very hard. He certainly doesn't want to see turmoil and death. He doesn't want to see it. He is a good man. He is a very good man and I got to know him very well.

"With that being said, he loves China and he loves the people of China. I know he would like to be able to do something, perhaps it's possible that he can't."

Trump spoke just a day after he and his top national security advisers briefed U.S. lawmakers on the North Korean threat and one day before Secretary of State Rex Tillerson will press the United Nations Security Council on sanctions to further isolate Pyongyang over its nuclear and missile programs.

'He's 27 years old. His father dies, took over a regime. So say what you want but that is not easy, especially at that age.' - Donald Trump, on Kim Jong-un

The Trump administration on Wednesday declared North Korea "an urgent national security threat and top foreign policy priority." It said it was focusing on economic and diplomatic pressure, including Chinese cooperation in containing its defiant neighbor and ally, and remained open to negotiations.

U.S. officials said military strikes remained an option but played down the prospect, though the administration has sent an aircraft carrier and a nuclear-powered submarine to the region in a show of force.

Any direct U.S. military action would run the risk of massive North Korean retaliation and huge casualties in Japan and South Korea and among U.S. forces in both countries.

Trump: 'Saudi Arabia has not treated us fairly'0:29

'I hope he's rational'

Trump, asked if he considered North Korean leader Kim Jong-un to be rational, said he was operating from the assumption that he is rational. He noted that Kim had taken over his country at an early age.

"He's 27 years old. His father dies, took over a regime. So say what you want but that is not easy, especially at that age.

"I'm not giving him credit or not giving him credit, I'm just saying that's a very hard thing to do. As to whether or not he's rational, I have no opinion on it. I hope he's rational," he said.

Trump, sipping a Coke delivered by an aide after the president ordered it by pressing a button on his desk, rebuffed an overture from Taiwan President Tsai Ing-wen, who told Reuters a direct phone call with Trump could take place again after their first conversation in early December angered Beijing.

China considers neighbouring Taiwan to be a renegade province.

"My problem is that I have established a very good personal relationship with President Xi," said Trump. "I really feel that he is doing everything in his power to help us with a big situation. So I wouldn't want to be causing difficulty right now for him. So I would certainly want to speak to him first."

Trump also said he hoped to avoid a potential government shutdown amid a dispute between congressional Republicans and Democrats over a spending deal with a Saturday deadline looming.

Trump: 'We are really eradicating some very bad people'0:14

Misses being able to drive

He also defended the one-page tax plan he unveiled on Wednesday from criticism that it would increase the U.S. deficit, saying better trade deals and economic growth would offset the costs.

"We will do trade deals that are going to make up for a tremendous amount of the deficit. We are going to be doing trade deals that are going to be much better trade deals," Trump said. 

'This is more work than in my previous life. I thought it would be easier.' - Donald Trump

Trump on Thursday reflected on his first 100 days in office with a wistful look at his life before the White House.

"I loved my previous life. I had so many things going," Trump said. "This is more work than in my previous life. I thought it would be easier."

Trump, who said he was accustomed to not having privacy in his "old life," expressed surprise at how little he had now. And he made clear he was still getting used to having 24-hour Secret Service protection and its accompanying constraints.

"You're really into your own little cocoon, because you have such massive protection that you really can't go anywhere," he said. When the president leaves the White House, it is usually in a limousine or an SUV. He said he missed being behind the wheel himself. "I like to drive," he said. "I can't drive any more."

Many things about Trump have not changed from the wheeler-dealer executive and former celebrity reality show host who ran his empire from the 26th floor of Trump Tower in New York and worked the phones incessantly. He frequently turns to outside friends and former business colleagues for advice and positive reinforcement. Senior aides say they are resigned to it. 

USA-TRUMP/

U.S. President Donald Trump speaks during an interview with Reuters in the Oval Office of the White House in Washington on Thursday. (Carlos Barria/Reuters)