HEADLINES IN BRIEF

• A ceasefire between Israel and Hezbollah came into effect Friday 16:00 local time, a US official said, following the deaths of 18 Lebanese and four Israeli soldiers as the two parties exchanged overnight strikes. READ MORE BELOW

• Earlier, US vice president JD Vance had abruptly canceled Swiss ceremonial signing and peace talks as Israel-Lebanese assaults escalated. READ MORE BELOW

• "All of Lebanon must burn" said Israel's Itamar Ben Gvir after four soldiers killed: "For every tear shed by an Israeli mother, a thousand Lebanese mothers must weep," he added.

• International benchmark Brent crude reached $80.66 on Friday morning as details of Israel's escalation in Lebanon emerged; it remains hovering around the $80 mark as markets waver on peace in the Middle East.

• $80 billion needed for war in Iran, the Wall Street Journal reported. READ MORE BELOW

• Vance issues warning against Israeli politicians’ criticism of US-Iran deal: "If I was in the cabinet of the Israeli government, I might not be attacking the only powerful ally that I have anywhere left in the entire world."

• Donald Trump repeats assertion: "If it weren’t for me, Israel would not exist today."

Apparent Israel-Hezbollah ceasefire after 18 Lebanese and 4 Israeli soldiers killed 

Israel and Hezbollah agreed to a ceasefire in Lebanon on Friday, a US official said, after an escalation in fighting there jeopardized the chances of an interim agreement on ending the war in Iran turning into a lasting Middle East peace deal.

US-Iran talks in Switzerland planned for Friday were canceled as fighting flared in Lebanon, creating new uncertainty about the timing of negotiations vital to ensure the reopening of the Strait of Hormuz to global shipping.

The senior US official said shortly before 4 p.m. Lebanon time (1300 GMT) that a ceasefire would come into effect then.

"We understand that after the exchange of fire earlier today, Israel and Hezbollah are now in a ceasefire," the official said on background, saying that negotiators for the US and Qataris worked out the agreement with help from Iran.

Tensions had flared overnight as intense strikes from both sides pounded cities and towns along the border. 

Following Israeli shelling throughout Thursday, Hezbollah targeted Israeli forces near the southern Lebanese city of Nabatieh. Israel responded with heavy airstrikes on 80 Hezbollah targets, according to authorities. 

The Lebanese health ministry reported "a preliminary toll of 18 martyrs and 33 wounded" in at least 10 villages and towns. Israel announced the death of four of its soldiers, sparking fury across Israel. Far-right finance National Security minister Itamar Ben Gvir took to X to denounce the four deaths, saying: "For every tear of an Israeli mother, a thousand Lebanese mothers must weep. All of Lebanon must burn!"

Defense minister Israel Katz has insisted that Israeli forces will remain in south Lebanon, and will respond with "force" to any attack; prime minister Benjamin Netanyahu has issued a similar statement, saying the army will stay in Lebanon "as long as necessary." 

However both parties have now agreed to implement a ceasefire from 16:00 local time, according to US officials. This will be the second ceasefire Israel has agreed to this month, having renewed a truce with the Lebanese government in early June, which Hezbollah was not part of. 

Lebanon continues to play a central role in the peace deal brokered between the US and Iran, with the latter insisting that Israel must withdraw its forces from the neighboring country. The condition, already rejected by Israel, seems all the more unlikely given the overnight attacks. 

Lebanese families have already been evacuating the southern city of Tyre, fleeing with mattresses strapped to the top of cars, saying the situation is not stable enough to stay. It is difficult to say whether the announced ceasefire will fully assuage concerns of residents. 

Yet with Iran's chief negotiator Mohammad Bagher Ghalibaf saying on Friday that any talks would remain bound by Tehran's "red lines", the cessation of Israeli attacks on Lebanon could improve the chances of progress between the US and Iran.

Swiss peace talks canceled last minute by Vance, blames logistics over no-show

US vice president JD Vance abruptly called off planned peace talks with Iran in the early hours of Friday, which were due to take place in the Swiss alps later in the day. Vance's staff were reportedly waiting to fly to the summit at an airbase when the trip suddenly canceled. 

The meeting was originally set up as an official signing ceremony of the Memorandum of Understanding (MoU) between the US and Iran, which opens a 60-day window for negotiations towards a lasting peace plan. As the MoU was signed electronically on Wednesday instead, talks were due to be held between the US and Iran to further progress the deal. 

While the White House has blamed logistical hurdles, the Financial Times reported that the talks were postponed due to Israel launching a wave of deadly overnight air strikes on southern Lebanon, citing to three people familiar with the matter.

A new date for the talks has yet to be set. The no-show indicates that the deal, merely days old, could be already under strain.

$80bn for a war delivered by a president who promised peace  

The US Congress will be asked for $80 billion to cover costs for the war in Iran, alongside non-related bills such as farm and disaster relief, the Wall Street Journal reported on Thursday. 

The request will be made by Deputy‌ Defense Secretary Stephen Feinberg, who prepped lawmakers in phone calls over the course of the week, according to WSJ. 

The figure is a significant jump from the $25 billion price tag estimate that was given by a Pentagon official in April. Moreover, the request comes amid spiralling cross-bench criticism from politicians and backlash from everyday Americans.

A number of top Republicans levied heavy criticism on US president Donald Trump’s deal to end the war in Iran, with Senator Bill Cassidy saying on X "This is the worst foreign policy blunder in decades."

The comments will likely come as no surprise to the Trump administration, as the [president has publicly feuded with Cassidy for years, after the Republican senator voted in favor of Trump’s impeachment after the January 6 insurrection.

This is not the first instance of political backlash over the war however. At the beginning of this month, the US House of Representatives delivered a major challenge to the war in Iran, when four Republicans joined Democrats to support a war powers resolution that would require Trump to seek Congressional approval or withdraw forces from Iran. 

Donald Trump's election campaign was heavily premised on no US-led wars. In October 2024, at a campaign rally in Pennsylvania, Trump said to the crowds: "I will not send you to fight and die in a foolish, never-ending foreign war" In November of the same year, during his election victory speech, he repeated the assertion: "I'm not going to start a war. I’m going to stop wars."

At the time of signing the Pakistan-mediated Memorandum of Understanding with Iran, the US-led war had continued for over 15 weeks.