Israel refuses Lebanon pullout as Rubio defends Iran deal in Gulf

President Donald Trump said Tuesday that unfrozen Iranian assets would be used to buy food and medical supplies from the U.S., but Iran rejected the claim.

Israel’s defense minister said Wednesday that Israeli troops will remain in southern Lebanon, underscoring a major obstacle to U.S.–Iran peace talks as Washington’s top diplomat toured the Middle East to rally support for the accord.

The United States and Iran signed an initial agreement last week aimed at ending a war that has destabilized the region and disrupted global energy markets since the closure of the Strait of Hormuz. But disputes over financial incentives for Tehran, control of the waterway, and Israel’s parallel war in Lebanon have exposed the fragility of the deal.

Defense Minister Israel Katz told a conference in Tel Aviv that the Israeli military would not retreat. “We are not withdrawing, and as of this moment there is no American demand for Israel to withdraw from Lebanon,” he said. Prime Minister Benjamin Netanyahu has echoed the stance, insisting that troops must remain to protect northern Israel.

Lebanon and Israel are holding U.S.-mediated talks in Washington on a proposal for Israeli forces to hand over some territory to the Lebanese army. Iran has made a ceasefire in Lebanon a central condition of any peace deal. “For us, a ceasefire in Lebanon is as important as a ceasefire in Iran,” Iranian parliament speaker Mohammad Baqer Qalibaf said in Baku.

Israeli strikes continued Wednesday, with a drone attack on a car in southern Lebanon killing at least two people, according to Lebanese security and medical sources. The Israeli military said it was checking reports but confirmed earlier airstrikes against Hezbollah fighters.

Meanwhile, U.S. Secretary of State Marco Rubio met UAE President Sheikh Mohammed bin Zayed Al Nahyan in Abu Dhabi and will continue to Kuwait and Bahrain, both hosts of U.S. bases that came under Iranian missile fire during the war. Rubio is seeking to reassure allies who view the deal as overly generous to Tehran, including a $300 billion fund and sanctions relief.

President Donald Trump said Tuesday that unfrozen Iranian assets would be used to buy food and medical supplies from the U.S., but Iran rejected the claim. Confusion also surrounds nuclear provisions. Trump said Iran agreed to inspections “into infinity,” while Tehran denied any such commitment. Deputy Foreign Minister Kazem Gharibabadi said nuclear issues would only be addressed in a final agreement after sanctions are lifted.

Shipping through the Strait of Hormuz has resumed, easing oil prices, but long-term management of the waterway remains under discussion. Gulf states want free transit, while Iran has suggested possible fees. Trump insisted Wednesday that Iran had assured the U.S. there would be “no tolls, no insurance costs, and no other charges.”

The conflicting accounts highlight the uncertainty surrounding the peace process, with Israel’s refusal to withdraw from Lebanon and Iran’s pushback on nuclear inspections raising questions about whether the fragile accord can hold.