Iran conflict widens to Lebanon; Kuwait mistakenly shoots down US jets

Escalation of the Iran-U.S.-Israel Conflict and Regional Impact

By Parisa Hafezi and Alexander Cornwell

DUBAI/TEL AVIV, March 2 (Reuters) - The U.S.-Israeli air war against Iran expanded on Monday with no end in sight, Israel attacking Lebanon in response to strikes by Hezbollah, while Tehran fired missiles and drones at Israel, Gulf states and a British air base in far-away Cyprus.

The U.S. military said Kuwait's air defences had mistakenly shot down three American F-15E fighter jets during an Iranian attack. All six crew members ejected and were safely recovered. Video, filmed at a location verified by Reuters, showed one of the planes spiralling out of the sky, an engine lit up in flames.

Iran's Revolutionary Guard Corps announced a new wave of strikes against Israel later on Monday.

After a weekend of bombing that killed Iran's supreme leader, dragged its neighbours into war and shut shipping traffic in the Gulf, markets opened on Monday with energy prices rising sharply, putting the global economic recovery at risk.

U.S. Foreign Policy and Iranian Response

In the biggest U.S. foreign policy gamble in decades, President Donald Trump launched the campaign alongside Israel against a foe that had tormented the United States and its allies for generations.

Trump repeated his calls on Iranians to rise up and overthrow their leaders, and said the air campaign could last weeks. Within Iran, where residents have jammed highways to flee cities as bombs fell, there was uncertainty about the future and emotion ranging from apprehension to euphoria.

Reaction Inside Iran

Many Iranians openly celebrated the death of Supreme Leader Ayatollah Ali Khamenei, 86, who had ruled the country for 37 years and directed security forces that killed thousands of anti-government protesters at the start of this year.

But the conservative clerical leaders have shown no sign of yielding power. Military experts say U.S. and Israeli air power, with no armed force on the ground, may not be enough to drive them out. Meanwhile, scores of Iranians have been reported killed in strikes, including several that hit apparent civilian targets.

Civilian Impact and Public Sentiment

"They are killing children, they are attacking hospitals. Is this the kind of democracy Trump wants to bring us? Innocent people were first killed by the regime and now by Israel and the United States," Morteza Sedighi, a 52-year-old teacher, said by phone from Tabriz.

War Spreads to Lebanon

WAR SPREADS TO LEBANON

In a sign Iran's rulers are still reaching out to the outside world, a senior Iranian security official contacted Reuters to say Iran was defending itself against aggressors and would continue to do so.

A major new front in the war opened on Monday when Hezbollah, one of Tehran's principal allies in the Middle East, launched missiles and drones toward Israel in retaliation for the killing of Khamenei.

Israel responded with sweeping airstrikes, which it said targeted the Hezbollah-controlled southern suburbs of Beirut and struck senior militants. Lebanese state news agency NNA said an initial tally showed 31 people had been killed and 149 injured.

Israel declared Hezbollah leader Naim Qassem a "target for elimination". Officials said they were not considering a ground invasion of Lebanon for now.

Allies Under Attack

ALLIES UNDER ATTACK

Washington's allies in the Gulf came under renewed attack from Iranian missiles and drones. Black smoke rose above the area around the U.S. embassy in Kuwait, where there was a heavy presence of security, ambulances and fire trucks. There were loud blasts in Dubai and Samha in the UAE, and in Doha, capital of Qatar.

Oil and Economic Impact

Saudi Arabia shut its biggest refinery after drone strikes caused a fire there, one of a number of oil installations that became targets. Qatar, one of the top three global producers of liquefied natural gas, halted production.

In the first strike to reach U.S. allies in Europe, a drone hit Britain's Akrotiri air base in Cyprus overnight. Britain and Cyprus said the damage was limited and there were no casualties.

European allies distanced themselves from Trump's initial decision to go to war, saying it fell short of the legal threshold of responding to an imminent threat. But they have since said they would participate to help suppress Iran's ability to retaliate after Tehran struck their allies.

Diplomatic Reactions

A senior White House official told Reuters that Washington would at some point talk with Tehran - but not yet. 

"President Trump said new potential leadership in Iran has indicated they want to talk and eventually he will talk. For now, Operation Epic Fury continues unabated," the official said.

In an X post on Monday, Ali Larijani, a powerful adviser to Khamenei, said Iran would not negotiate with Trump, who had "delusional ambitions" and was now worried about U.S. casualties. 

First US Casualties and Political Risks

FIRST US CASUALTIES

The deaths of the first three American service personnel in the campaign were confirmed on Sunday. Two U.S. officials told Reuters they were killed on a base in Kuwait.

An extended military campaign could pose a major political risk for Trump's Republican Party ahead of U.S. midterm elections. Only around one in four Americans approve of the operation, according to a Reuters/Ipsos poll on Sunday.

Trump's Continued Campaign

In a video posted on Sunday, Trump vowed military strikes on Iran would continue until "all our objectives are achieved" without providing specifics.

Trump called on Iran's military and police, including the Islamic Revolutionary Guard Corps, to stop fighting, promising immunity for those who surrender and "certain death" for those who resist. He reiterated calls for Iranians to rise up.

Global Economic Consequences

Meanwhile, the interruption to oil shipments through the Strait of Hormuz - where around a fifth of the world's oil trade passes along the Iranian coast - was a sudden jolt to global economies. Oil prices leapt by double-digit percentages when trade opened on Monday. Shares fell and the dollar surged.