The Iran-backed Hezbollah group rejected a new cease-fire proposal in Lebanon on Thursday, while Israel signaled it would keep troops in the country, dealing a setback to U.S. President Donald Trump's efforts to end the conflict and advance broader diplomatic talks with Tehran.
Iran has tied any potential agreement with Washington to a cease-fire in Lebanon and has recently indicated it could become directly involved if Israel continues its military campaign.
However, Hezbollah leader Naim Qassem dismissed a U.S.-brokered deal negotiated between Israel and the Lebanese government to halt the fighting, noting that the group was not involved in the talks.
There was no immediate reaction from either Israel or Lebanon.
Speaking in Washington, Trump said he believed progress was being made and expressed hope for lasting peace in Lebanon.
Despite those diplomatic efforts, Israeli strikes continued across southern Lebanon.
Israeli Defense Minister Israel Katz said the military would neither withdraw its forces nor suspend operations in the country, where troops entered in March alongside Israel's wider conflict with Iran.
The commander of Iran's Islamic Revolutionary Guard Corps' Quds Force, which helped establish Hezbollah in 1982, said Israel must, at a minimum, withdraw to positions it held before the war began.
More moderate shooting
Along with Lebanon, residents of Gaza, northern Israel and Kuwait have all come under fire this week, despite U.S.-brokered cease-fires that Trump said on Wednesday involved "shooting in a more moderate manner," rather than a complete halt to fighting.
Iranian and American forces traded attacks in the Gulf on Wednesday in one of the most intense bouts of fighting since early April, when a cease-fire halted large-scale hostilities.
Iranian forces struck Kuwait's airport, killing one person and injuring more than 60 others, authorities said, while the U.S. military launched strikes near the Strait of Hormuz.
In Oman, an alleged drone attack forced the suspension of oil loading at the Mina al Fahal terminal after an explosion, two people familiar with the matter said Friday.
A fifth of global oil and liquefied natural gas supplies pass through the strait under normal conditions, but it has been largely closed since the war began three months ago.
Iranian oil exports have fallen to their lowest level in six years, shipping data show, but global oil prices fell about 3% on hopes that a cease-fire in Lebanon could help Washington and Tehran find a diplomatic off-ramp from the conflict.
There has been little evidence of diplomatic progress, though Trump has repeatedly declared since late March that a deal is close.
Trump, under pressure at home to lower fuel prices ahead of November congressional elections, received a rare rebuke from the House of Representatives on Wednesday when it voted to block him from continuing the war. The largely symbolic measure is unlikely to become law.
Supreme Leader Ayatollah Mojtaba Khamenei said Thursday that Iran's enemies had already been defeated on the battlefield and were now seeking to sow internal divisions.
Khamenei has not been seen in public since succeeding his father, who was killed in an airstrike at the start of the war.
Tehran wants access to billions of dollars in oil revenue, waivers on sanctions targeting crude exports, the lifting of U.S. restrictions on its ports and leverage over the strait.
Trump, who has said his top priority is preventing Iran from acquiring nuclear weapons, told reporters Washington did not need a deal with Iran to secure its enriched uranium.
"I don't think they could stop us if we wanted, but there's no reason to," he said in the Oval Office. "It's entombed."
Iran says its atomic program is for peaceful purposes. The U.N. nuclear watchdog said Thursday that it found Iran's nuclear program largely unchanged despite three months of war.