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Isra el and Hezbollah vowed to widen the area of their conflict, as fighting intensified in southern Lebanon and jets raided targets in the Lebanese capital, Beirut.

Hezbollah will extend its rocket attacks “beyond Haifa,” Israel's third-largest city in the north, Sheikh Hassan Nasrallah, the group's leader said early today. Israel will hold onto an area of southern Lebanon it occupied from 1978 to 2000, until its troops are replaced by international peacekeepers, Defense Minister Amir Peretz said yesterday.

An Israeli air strike late yesterday killed two United Nations soldiers and left two missing in southern Lebanon, UN Secretary General Kofi Annan said. He described the incident as the “apparently deliberate targeting” of the peacekeepers.

Israeli Prime Minister Ehud Olmert, in talks yesterday with US Secretary of State Condoleezza Rice said “humanitarian corridors” will be opened to address a food and refugee crisis in Lebanon. The Red Cross estimates that 700 000 Lebanese lack basic supplies such as food and water. A total of 386 Lebanese and 41 Israelis, including 24 soldiers, have been killed since the conflict began July 12.

Hezbollah will continue firing rockets at northern Israel whatever the depth of the Israeli advance into Lebanese territory, Nasrallah said in a video message broadcast by the group's Al-Manar television channel in Beirut. At least eight people have been killed in rocket attacks on Haifa since July 16, Israeli police said three days ago.

While Hezbollah “is open to a political approach” to end the war, it rejects “conditions that would be humiliating,” Nasrallah said.

The deaths of UN observers near the town of Khiyam occurred after 14 incidents of shelling close to the base, UN spokeswoman Marie Okabe said yesterday.

“I call on the government of Israel to conduct a full investigation into this very disturbing incident and demand that any further attack on UN positions and personnel must stop,” Annan said in a statement released in New York.

Israel “sincerely regrets” the deaths of UN personnel and will investigate the incident, the Israeli daily newspaper Haaretz reported, citing Foreign Ministry spokesman Mark Regev.

The observers were from China, Austria, Canada and Finland, the newspaper reported, citing unidentified UN officials.

Israeli soldiers yesterday advanced in southern Lebanon to Bint Jubayl, the largest town in the border strip. Nasrallah said Hezbollah fighters still control the town. Aircraft resumed the bombardment of Beirut as Hezbollah rockets hit Haifa, causing injuries to civilians, Israel's army said.

Hezbollah, founded in 1982, has claimed credit or been linked to scores of attacks on Israelis and Americans, including rocket attacks on Israeli towns, the 1983 bombing that killed 241 US soldiers in Beirut, and the 1994 attack that killed 95 at a Jewish community center in Buenos Aires. The US and Israel have designated Hezbollah a terrorist organization.

Rice and Olmert yesterday agreed on the need to defeat Hezbollah while addressing the refugee and food crisis.

“It is time to say to those who do not want a different kind of Middle East that we will prevail, they will not,” Rice said in Jerusalem. Israelis, Lebanese and Palestinians have lived in fear for too long, she said.

After meeting Olmert, Rice went to Ramallah in the West Bank for talks with Palestinian Authority President Mahmoud Abbas.

Seven Palestinians were killed in an Israeli air force strike in the Gaza Strip early today, Haaretz reported, without saying where it obtained the information.

Annan yesterday appealed for $150-million in international assistance for Lebanon. Saudi Arabia pledged $500-million in aid and will deposit $1-billion with the Central Bank of Lebanon to support the country's economy, according to the state-run Saudi Press Agency. The US has pledged $30-million in aid.

Lebanese Finance Minister Jihad Azour told Bloomberg yesterday Israel's air strikes displaced 20% of the population and damaged infrastructure, housing and factories. The Food and Agriculture Organization of the UN said Lebanon's food supply chain has been damaged and the displacement of people from southern Lebanon will hurt the main grain harvest.

“These factors combined provide the recipe for a major food crisis,'' said Henri Josserand, chief of the agency's Global Information and Early Warning System.

Olmert told Rice that Israel will expand “humanitarian corridors.” One will allow planes carrying relief supplies to land at Beirut International Airport and one will be on land from Israel to Lebanon. Israel will also allow aid to arrive through the seaports of Beirut, Sidon and Tyre, according to a statement released by Olmert's office.

“We are using the basic elementary rights of self-defense against terrorist organizations,” Olmert said at the news conference with Rice. “We are not fighting the Lebanese government, and we are not fighting the Lebanese people. Israel is determined to continue the fight against Hezbollah.”

Lebanon's airport and bridges were military targets because they were used to ship arms to Lebanon, Shimon Peres, Israel's deputy prime minister, told Cable News Network yesterday. Israeli forces didn't target civilians, he said.

Rice attends a meeting in Rome today of representatives of the European Union, some Arab governments and the UN. The agenda includes discussion of an international military force to patrol southern Lebanon.

The region, adjacent to Israel's northern border, is controlled by Hezbollah, which is sponsored by Syria and Iran. A UN resolution calls for its disarmament and for the Lebanese army to take over the area. Hezbollah's capture of two Israeli soldiers in a cross-border attack July 12 sparked the conflict.

Israel started its attack on Lebanon two weeks after it sent its forces into the Gaza Strip when a group led by the Islamic Hamas movement kidnapped a soldier in a cross-border raid on June 25. Israel unilaterally withdrew from Gaza in 2005, razing Jewish settlements it established after seizing the area from Egypt in the 1967 Six-Day War.

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