Iranian cash funds Hezbollah drone work, sources say

Hezbollah has spent the three months since June buying explosives and building drones aimed at Israel's security zone in southern Lebanon, using cash from Iran, according to Lebanese security sources briefed on the group's activities. One source close to the group said tens of millions of dollars arrived from Tehran for that work, on top of about $200 million Reuters previously reported.

The group was founded by Iran's Islamic Revolutionary Guard Corps in 1982. Fighting with Israel since 2024 has killed thousands of its fighters and many of its leaders, and destroyed much of its arsenal. Israeli troops now hold a security zone in southern Lebanon, and political pressure has mounted in Beirut for the group to disarm.

The timeline starts in February, when a US-Israeli war with Iran began. Hezbollah struck Israel on March 2 in support of Iran; Israel answered with strikes that pushed many of the group's Shi'ite Muslim constituents out of southern Lebanon. Hostilities eased over the summer after an interim US-Iran deal included a Lebanon ceasefire and Washington-mediated talks between Lebanon and Israel. That deal has since collapsed, but full-scale fighting has not resumed in Lebanon, and Israel continues striking Hezbollah in the south.

Sources said the group has not finished restocking or rebuilding its fighting force. Hezbollah's media office rejected the claim that its command-and-control systems had broken down. A Hezbollah official and a Lebanese security source told Reuters that explosives seized by Lebanese authorities this month were the group's own and were meant for its explosive drones.

Two Lebanese sources and three security officials familiar with operations said the group is restoring command structures that failed in fighting at Bint Jbeil and the Ali al-Taher ridge. They said the group's habit of small units and limited anti-tank rockets left troops isolated there, unable to match Israeli remotely operated systems, including weaponized drones and armed remote-controlled vehicles.

Washington is applying pressure through sanctions. A State Department spokesman said the US will keep tightening the group's finances, and a Treasury spokesperson said Iran is running out of money and ways to move it.

The group remains on alert for a wider escalation that could bring fighting back to Lebanon. Its media office said it does not want to give Israeli leaders a reason to step up operations against it. Israel's military declined to comment, and Iran's UN mission in Geneva did not respond to Reuters questions.

No date has been set for further talks between Lebanon and Israel.