Iran-US MoU a setback, what are the options now for Israel, and for Netanyahu

“The mood in Israel is a mixture of anger, suspicion, and humiliation right now. The hawks in the ruling coalition are denouncing the deal as bad or non-binding, with some on the right wing accusing Trump of abandoning Israel. The Opposition calls it a strategic failure. The deeper mood is that Israel fought hard, but Washington and Tehran may now be defining the exit,” Yonatan Touval, an analyst with the Israeli think tank Mitvim, told The Indian Express.

Israel has insisted it won’t stop its Lebanon campaign, where it is fighting the armed wing of the Hezbollah, a Shia group supported by Iran.

Israel has established a ‘security buffer zone’ inside Lebanon. (Photo: X/IDF)

The Israel Defense Forces (IDF) on Thursday posted on X, “The IDF is deployed in the Security Zone, ~10 km inside Lebanese territory, due to operational requirements. IDF soldiers will continue to remove threats and strengthen the defense of Israel’s northern residents.” Iran has insisted that any peace deal means peace in Lebanon too, and Trump has accepted this demand.

Where does this leave Israel and its Prime Minister Benjamin Netanyahu? Can it continue fighting in Lebanon, endanger the deal and potentially infuriate Trump? Can Netanyahu survive politically if the MoU is seen as a surrender that fritters away hard-fought gains? We explain.

What is the road ahead for Israel?

The MoU says that Iran and US will negotiate a final deal within 60 days of its signing. For Israel, the immediate job will be to use these 60 days to convince the Americans to secure more favourable terms for them, while maintaining cautious freedom of action in Lebanon.

“There is almost zero chance that Israel just stops everything in Lebanon tomorrow. Even if there is a ceasefire, it will take time to negotiate and implement. In the 60 days, Israel would try to press the US for better terms, regarding Iran’s enriched uranium, enrichment facilities and centrifuges, for example, in any final deal,” Dahlia Scheindlin, a Tel Aviv-based political analyst, told The Indian Express.

The 60-day timeline, however, can be extended, and given Trump’s unpredictability, it is difficult to predict what form that deal might take. Israel and Lebanon are holding parallel negotiations for peace, mediated by the US, but have not made substantial progress.

“Israel now faces a real dilemma: whether to insist on preserving unilateral freedom of action, at the risk of friction with Washington, or to accept the MoU’s de-escalatory logic and try to convert military gains into an enforceable Lebanese-state framework. The sensible course is not endless attrition, but a harder version of diplomacy: codified red lines, rapid response to immediate threats, US-backed enforcement, Lebanese Army responsibility, and no return to a Hezbollah military presence along the border,” Touval said.

Israel’s current campaign in Lebanon began when Hezbollah fired rockets into its territory after the assassination of Ayatollah Ali Khamenei. However, it has attacked the neighbouring country multiple times, each time aiming to defeat the Hezbollah.

A building damaged in Israeli strikes in the southern port city of Tyre, Lebanon. (AP Photo)

This time, its bombing of residential buildings in many parts of Lebanon, beyond the Hezbollah’s traditional strongholds, has drawn widespread criticism, including from Trump. Israel has also occupied parts of Lebanon, to establish a ‘buffer zone’ and keep the Hezbollah away from its borders. However, despite a brutal campaign, the Hezbollah’s armed wing still possesses strike capabilities — much like after previous such campaigns — and the organisation remains powerful politically and culturally in Lebanon.

Beyond a potentially continuous exchange of strikes, what is Israel’s roadmap in Lebanon?

Touval said this would involve Hezbollah “pushed away from the Israel-Lebanon border, stripped of open military freedom in the south, unable to fire rockets/drones at Israel, and reduced from a forward-deployed border army into a hostile Lebanese political actor, still dangerous inside Lebanon but no longer positioned to threaten Israel directly from the border.”

What does the MoU mean for Netanyahu?

The MoU chips away at two of Netanyahu’s core strengths — his much-touted ‘tough on security’ posturing, and his equally touted friendship with Trump. His actions in Gaza and Lebanon have dented Israel’s image in much of the world, without delivering on any of his promises of a defanged Iran and a defeated Hezbollah. And the timing couldn’t have been worse, with elections around three months away.

Scheindlin said it was high time for Netanyahu to learn how to convert military gains into diplomatic ones. “This government has little trust in political processes. Even in Lebanon, they believe force is the only way. It is a very short-sighted way of thinking,” she said.

But elections are due in a few months, could policy change if the prime minister changes? “So far, the Opposition has been claiming that it would have fought the same wars, but better. If there is a new government, it would need a new, bold vision for peace. However, there is indeed an expectation that a government not headed by Netanyahu would be more restrained,” Scheindlin said.

And what do the voters of Israel want? “A large section of Israelis has become conditioned to want complete military victory. After October 7, people think such an attack could happen any day, there is this life and death attitude to everything. But it is inexcusable for a government to think like that. The government’s job is to take a long-term, strategic view,” she said.