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Richard Beeston, Diplomatic Editor of The Times, says that Israel's overnight bombing of Lebanon is a huge setback for a country that had been trying to rebuild itself

"The attacks on Lebanon overnight certainly follow a pattern that we have seen in Israel's dealings with Lebanon over the past 30 years. But there had been hopes last year, after the withdrawal of Syrian troops, that this cycle would be broken.

"Lebanon had a democratically elected government, which included Hezbollah ministers in the cabinet. Many Lebanese believed that they had finally turned a corner in their history and that their country would no longer be used as the battleground for Israel against Syria and Iran.

"Those hopes have been dashed. The country has taken a big step backwards. The summer tourist season, which the Lebanese economy relies on, has been ruined. The newly-built infrastructure, like the airport and bridges, is being destroyed.

"There are fears that the situation could escalate. Hezbollah has thousands of rockets capable of hitting northern Israel. Israel has enough aircraft and artillery to wreak havoc in Lebanon.

"In the past American intervention has been decisive in stopping this type of violence. So far there has been only a muted response from the White House. But George Bush will be in Germany today and then go on to St Petersburg for the G8 summit. It is hard to imagine that events in the Middle East will not dominate discussions.

"Syria has a key role to play. Although it no longer has a formal presence in Lebanon it is still hugely influential and to a great extent can control what Hezbollah does.

"But the Syrians will only help for a price. They would like to see their role in the region recognised by the Americans and for their pariah status to end.

"In the longer term, Hezbollah is clearly calculating that it can take the pain longer than Israel. Sheikh Hassan Nasrallah, the Hezbollah leader, evidently believes that he can do a prisoner swap, as Israel has agreed to in the past. However, I understand that the Americans are deeply opposed to any prisoner exchange with groups it regards as terrorists, possibly fearing that it will come under pressure to do the same when its soldiers are captured in Iraq.

"The status of Hamas is an added complicating factor. We now have a situation where the two main groups involved in provoking this crisis — Hamas and Hezbollah — are both regarded as terrorist organisations that the West cannot talk to. This leaves the way for intermediaries like Egypt and possibly Syria, but so far neither has been able or willing to bring the crisis to a close."

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