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US says it struck Iranian military sites, Tehran responds with air base attack - Finance news and analysis from Global Banking & Finance Review
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US says it struck Iranian military sites, Tehran responds with air base attack

Published by Global Banking & Finance Review

Posted on June 1, 2026

4 min read

· Last updated: June 2, 2026

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Lebanon announces partial ceasefire between Israel, Hezbollah but attacks continue

Overview of the Lebanon-Israel-Hezbollah Conflict and Ceasefire

By Laila Bassam, Maya Gebeily and Hatem Maher

Announcement of Partial Ceasefire

BEIRUT/JERUSALEM, June 1 (Reuters) - Lebanon announced a partial ceasefire between Hezbollah and Israel on Monday in what would amount to a limited de-escalation of a conflict that has killed thousands of people and inflamed the broader U.S.-Israeli war with Iran.

Terms of the Agreement

According to Lebanon's embassy in Washington, the agreement would not end the conflict in that country. But it calls for Israel to refrain from strikes on Beirut and its suburbs controlled by Hezbollah, while the Iran-aligned group would halt its attacks on Israel.

Continued Hostilities

Hostilities in southern Lebanon, which Israel invaded in March, continued on Monday evening. Early on Tuesday, the Israeli military said that it intercepted two projectiles that crossed from Lebanon into northern Israel, and that no injuries were reported.

International Reactions and Statements

U.S. and Israeli Leadership Responses

U.S. President Donald Trump, who first announced the agreement, said Hezbollah, through intermediaries, had pledged not to attack Israel. No U.S. president has ever spoken with Hezbollah, with or without intermediaries. The U.S. has designated the group as a terrorist organization. 

Trump also said Israeli Prime Minister Benjamin Netanyahu agreed to pull back any troops preparing to attack Beirut. 

After Trump's announcement, Netanyahu said Israel would continue military operations in southern Lebanon, where ground forces are pushing toward the Zaharani River, their deepest incursion in Lebanon in 25 years.

Hezbollah's Position

Hezbollah lawmaker Hassan Fadlallah said the militia would support a full ceasefire across all Lebanon as a precursor to the withdrawal of Israeli troops. He did not say whether the group would stop its strikes on Israeli territory.

Prospects for Expanding the Ceasefire

Lebanon said it would seek to expand the ceasefire in talks with Israel in Washington on Wednesday. 

Wider Context of the Conflict

Background and Ongoing War

That could clear the path for renewed efforts to end the three-month-old war that began with U.S. and Israeli attacks on Iran. The process has been stuck in limbo for weeks under a fragile ceasefire as negotiators have been unable to agree on an initial framework for peace talks.

The Israel-Hezbollah war erupted on March 2 as an offshoot of the broader conflict and has been entangled with it ever since.

Iran's Stance and Involvement

Iran has insisted on a halt to Israeli attacks in Lebanon as a condition of any deal to end the war, while the U.S. has said the two conflicts are separate.

"The ceasefire between Iran and the U.S. is unequivocally a ceasefire on all fronts, including in Lebanon," Iranian Foreign Minister Abbas Araqchi said in a statement.

Escalation Risks and Economic Impact

Iran Threatens to Break Off Talks

Suspension of Peace Negotiations

IRAN THREATENS TO BREAK OFF TALKS

Iranian state media said earlier on Monday that Tehran was halting indirect peace negotiations with the U.S. and might end a ceasefire that has largely held since early April, citing the war in Lebanon.

There was no direct confirmation of the reports from Iranian officials, and Trump told an NBC reporter that he had not heard from Iran. He said in a CNBC interview on Monday that the peace talks had "started to get very boring" and that he did not care if they were over.

"I really don't care, I couldn't care less," Trump said.

Repeated Strikes Despite Ceasefire

Since mid-March, Trump has repeatedly said he is close to signing a peace agreement but has yet to do so. Despite the ceasefire, Iran and the U.S. have exchanged strikes several times over the past week. 

Threats to Global Oil Supply

Meanwhile, the head of Iran's Revolutionary Guards Quds Force, Esmaeil Qaani, threatened to expand its blockade of the Strait of Hormuz to the Bab El Mandeb Strait, another chokepoint at the mouth of the Red Sea.

Iran has already bottled up maritime traffic in the Gulf that before the war provided one-fifth of the world's oil and liquefied natural gas, sending prices sharply higher. 

Oil prices rose 4% on Monday on the heightened tensions.

(Reporting by Reuters bureaus; Writing by Andy Sullivan, Lincoln Feast, Timothy Heritage, Gareth Jones, Jonathan Allen and Cynthia Osterman; Editing by Raju Gopalakrishnan, Alex Richardson and Andrew Heavens)

Key Takeaways

  • The U.S. struck Iranian radar and drone command sites on Goruk and Qeshm Islands responding to aggressive actions including the shoot‑down of an MQ‑1 drone (marketscreener.com)
  • Iran’s Islamic Revolutionary Guard Corps said it targeted a U.S. air base used in U.S. attacks on southern Iran; details on which base were not released (reddit.com)
  • Air defences in Kuwait intercepted missile and drone attacks amid sirens as the conflict escalates around U.S. bases in the region (reddit.com)

References

Frequently Asked Questions

Why did the US strike Iranian military sites?
The US struck Iranian military sites in response to aggressive actions, including the shootdown of a US drone over international waters.
How did Iran respond to the US strikes?
Iran's Revolutionary Guards targeted a US base as retaliation for the strikes on Iranian territory.
How have tensions affected energy prices?
The conflict has pushed global energy prices higher due to Iran's closure of the Strait of Hormuz, impacting the flow of oil.
What are the broader economic impacts of the conflict?
Rising tensions have led to global economic uncertainty, increased energy costs, and have complicated ongoing negotiations over sanctions and oil revenues.
What issues complicate US-Iran negotiations?
Key issues include Iran's nuclear program, sanctions relief, frozen oil revenues, and regional conflicts involving Hezbollah.

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