US President Joe Biden signed a foreign aid package that includes sanctions on Iran’s oil sector into law on Wednesday.

The United Nations’ atomic watchdog expects to meet senior Iranian officials next month to discuss growing concern the Persian Gulf nation could build a nuclear weapon in response to escalating tension with Israel.

Israel steps up cross-border strikes on Hezbollah in Lebanon

The Israeli military said it struck about 40 sites linked to Hezbollah in southern Lebanon, an apparent escalation of the almost daily skirmishes between the two sides since the start of the war in Gaza.

The Israel Defense Forces said its rockets hit storage facilities, weaponry and “additional targets used by Hezbollah” in the area of Ayta ash Shab, a village near the Israel-Lebanon border. The barrage came a day after the Iran-backed militant group staged the deepest attack inside Israel since the conflict began in October.

There was no immediate response from Hezbollah or reports of any casualties.

The US and European allies have long been concerned that tension between Israel and Hezbollah could evolve into a new front in the broader Middle East conflict, which has seen Israel clash with both Iran and its various proxy militias around the region.

Hezbollah, which like Hamas is dedicated to the destruction of the Jewish state, is the most powerful of those Islamist groups, which also include the Houthis in Yemen.

Israel’s defence minister, Yoav Gallant, said the army had already killed half of Hezbollah commanders in southern Lebanon and its goal was to restore border security and allow tens of thousands of evacuated residents to return home.

“We are dealing with a few alternatives to make this a reality, and the coming period will be decisive,” he said in a video statement. 

Israel is also readying its military to start a major ground invasion of Rafah, the southern Gazan city where more than one million Palestinian civilians have taken refuge from the ongoing war with Hamas. Prime Minister Benjamin Netanyahu’s government believes the remaining Hamas fighters and some leaders are holed up there.

Hezbollah is thought to have more than 100,000 fighters, many of which are situated close to the border with Israel. The group has a far bigger and more sophisticated arsenal of missiles and other weapons than Hamas, which Israel is trying to destroy in retaliation for the deadly 7 October attacks on the south of the country.

On Tuesday, the Lebanese militia fired explosive-laden drones at two army bases on Israel’s northern coast after Israeli strikes killed two of its key operatives, the farthest it has struck inside Israeli territory since the start of the Gaza war. Israel intercepted what it described as three “suspicious aerial targets” over the sea. Sirens sounded in several coastal cities including Acre.

Earlier on Wednesday, Hezbollah hit two houses with missiles fired toward Avivim, an Israeli settlement near the Lebanese border.

Biden signs $95bn aid package into law, includes Iran oil sanctions 

US President Joe Biden signed a foreign aid package that includes sanctions on Iran’s oil sector into law on Wednesday. 

The legislation, which was approved by the Senate on Tuesday night by a vote of 79-18, broadens sanctions to include foreign ports, vessels and refineries that knowingly process or ship Iranian crude in violation of existing US sanctions. It also expands so-called secondary sanctions to cover all transactions between Chinese financial institutions and sanctioned Iranian banks used to purchase petroleum and oil-derived products.

The $95-billion aid package also includes assistance for Ukraine, Israel and Taiwan. 

The measure requires an annual determination as to whether Chinese financial institutions have engaged in conduct that violates sanctionable conduct, according to a report by the House Financial Services Committee, which said 80% of Iran’s roughly 1.5 million barrels per day of exports go to China to be refined by small independent refineries known as “teapots”. 

Analysts said Biden was likely to take advantage of waiver authority built into the sanctions and could opt to avoid stringent enforcement of the sanctions, which could contribute to a rise in oil and petrol prices.  

“Our take is that President Biden will use any flexibility afforded him to ensure no material disruption in Iranian crude oil takes place before the election,” said Bob McNally, president of consultant Rapidan Energy Group and a former White House official “There is no higher priority for the White House than preventing an oil price spike this year.” 

Iran’s nuclear sabre-rattling raises more alarm at UN watchdog

The United Nations’ atomic watchdog expects to meet senior Iranian officials next month to discuss growing concern the Persian Gulf nation could build a nuclear weapon in response to escalating tension with Israel.

International Atomic Energy Agency (IAEA) monitors were disturbed by comments made on 18 April by a top Iranian general that the Islamic Republic could revise its nuclear doctrine if Israel targets its atomic facilities. The remarks were widely taken as a warning that Iran could switch to building a warhead, having long said its atomic capability is only for civil purposes.

Read more: Iran says Israeli threats may spark shift in nuclear policy 

“Statements by a very high defence establishment official like the general are a source of concern,” IAEA Director-General Rafael Mariano Grossi said on Wednesday in an interview in the Dutch port of Rotterdam. “The Middle East is in a very fragile situation. There is the need for a respectful but very serious conversation with them.”

Tit-for-tat missile strikes between Israel and Iran this month have added urgency to the IAEA’s years-long search to uncover the truth of Iran’s nuclear ambitions. While the IAEA carries out daily inspections of declared atomic facilities, suspicions linger over whether Iranian engineers could be concealing work used for military purposes. Tehran has blocked the agency’s investigation into uranium detected at undeclared sites. 

Read more: How close is Iran to having a nuclear weapon?: QuickTake

Islamic Revolutionary Guard Corps Commander Ahmad Haghtalab didn’t specify what changes he had in mind for Iran’s nuclear doctrine, though he warned an attack on the country’s nuclear facilities would prompt return fire on Israel’s own sites.

He was speaking after Iran launched a barrage of about 300 drones and missiles on Israel in response to a strike in Syria that killed several Iranian officers on 1 April. Israel responded on Friday with a more limited attack, allowing both sides to pause hostilities for now.

A senior Iranian legislator said on Wednesday that his country was technically able to enrich uranium to 90% purity “for warheads” in “half a day or let’s say one week,” but said Supreme Leader Ayatollah Ali Khamenei remained opposed to developing nuclear weapons.

Javad Karimi-Ghodoosi, a member of the chamber’s National Security Commission, made the comments in a video statement posted on X. DM