JERUSALEM (AP) – Israel’s government decided Thursday not to expand its battle with Hezbollah in southern Lebanon for now, but authorized the army to call up 30,000 reserve soldiers in case the fighting intensifies. Lebanese officials estimated a civilian death toll as high as 600.

Israeli Radio reported that Israeli aircraft hit 130 targets in Lebanon on Thursday and early today, including a Hezbollah base in the Bekaa Valley, where long-range rockets were stored.

With Hezbollah allies Iran and Syria reportedly meeting in Damascus to discuss the crisis, Secretary of State Condoleezza Rice said she was “willing and ready” to return to the region to work for a sustainable peace agreement.

But President Bush suggested he would support the offensive for as long as it takes to cripple Hezbollah. He also sharply condemned Iran for its support of the Shiite Muslim militant group.

The call-up signaled that Israel was settling in for a much longer battle than had initially been expected.

With no end in sight after 16 days of intense fighting, al-Qaida’s No. 2 man vowed to attack “everywhere” until Islam prevails.

In recent days, senior Israeli generals urged the government to authorize a broader ground campaign in southern Lebanon, which they said would help the thousands of troops already engaged in bloody battles there.

Israel’s security Cabinet authorized the army to call up three additional reserve divisions to refresh the troops in Lebanon if they are needed, but rejected the generals’ advice to expand the offensive.

However, Justice Minister Haim Ramon said the failure of world leaders to call for an immediate cease-fire at a summit in Rome gave Israel a green light to carry on with its campaign to crush Hezbollah – an assertion hotly rejected by European officials.

Wednesday’s conference ended in disagreement, with most European leaders calling for an immediate cease-fire and the United States wanting to give Israel more time to neutralize Hezbollah.

European leaders said Ramon was mistaken.

“We received yesterday at the Rome conference permission from the world …. to continue the operation, this war, until Hezbollah won’t be located in Lebanon and until it is disarmed,” Ramon told Israel’s Army Radio.

“I would say just the opposite – yesterday in Rome it was clear that everyone present wanted to see an end to the fighting as swiftly as possible,” German Foreign Minister Frank-Walter Steinmeier said.

Israeli airstrikes on southern Lebanon on Thursday struck roads and houses, many believed to be the deserted homes of Hezbollah activists, in the apple-growing region of Iqlim al-Tuffah. The strikes caused casualties, but fighting kept ambulances and civil defense crews from the areas, security officials and witnesses said.

Other strikes hit a Lebanese army base in the north, while artillery and warplanes pounded the area near the border, according to witnesses. However, the fierce ground battles that raged Wednesday for the border towns of Bint Jbail and nearby Maroun al-Ras appeared to have abated, with U.N. observers reporting only “sporadic fighting” there.

Israeli Defense Minister Amir Peretz said the strategic damage to Hezbollah was “enormous” and said the group would “not return to what it was.”

Israel launched its offensive in Lebanon on July 12, after Hezbollah guerrillas overran the border, killed three Israeli soldiers on patrol and captured two others.

Since then, up to 600 civilians in Lebanon have been killed in a punishing campaign of airstrikes, artillery shelling and clashes. Lebanese Health Minister Jawad Khalifeh told The Associated Press on Thursday that 382 were confirmed dead and the rest either known to be buried under the rubble of buildings or missing.

The civilian deaths, combined with casualty figures released by the Lebanese army and Hezbollah guerrillas, bring the confirmed death toll on the Lebanese side to at least 437 killed.

Fifty-two Israelis have been killed in 16 days of fighting, including 33 soldiers and 19 civilians who died in Hezbollah rocket attacks into northern Israel. The guerrillas shot 110 rockets into Israel on Thursday, wounding 20 people and bringing the total of rockets launched to 1,564.

The army broadcast a warning on its Arabic-language radio station Thursday telling Lebanese in the south that their villages would be “totally destroyed” if rockets were fired from them.

Army Chief of Staff Dan Halutz said there have been hundreds of Hezbollah casualties and that “we have caused serious damage to their rocket-launching capabilities.”

But Lebanese President Emile Lahoud, a staunch supporter of Hezbollah, said Israel would never be able to crush the group militarily, and should stop fighting and start talking.

“Whatever it (Israel) does it’s not going to reach its goal,” he told The Associated Press. “They’re not going to be able to take out the weaponry of Hezbollah. So all they’re doing is massive destruction.”

Meanwhile, al-Qaida issued its first response to the violence, threatening to retaliate with new attacks.

The videotape by Osama bin Laden deputy Ayman al-Zawahri was an effort by the terror network to rally Islamic militants by exploiting Israel’s two-pronged offensive – against Hezbollah in Lebanon and Hamas-linked militants in Gaza.

“We cannot just watch these shells as they burn our brothers in Gaza and Lebanon and stand by idly, humiliated,” al-Zawahri said, adding that “all the world is a battlefield open in front of us.”

“The war with Israel does not depend on cease-fires. … It is a jihad (holy war) for the sake of God and will last until (our) religion prevails … from Spain to Iraq,” he said. “We will attack everywhere.”

In Damascus, Syrian and Iranian officials gathered to hold meetings on the crisis, according to Iranian and Kuwaiti news reports. Hezbollah leader Sheik Hassan Nasrallah was also to take part in the meeting along with Syrian President Bashar Assad, according to Kuwait’s Al-Siyassah newspaper, known for its opposition to the Syrian regime.

The newspaper said the meeting was designed to discuss ways to maintain supplies to Hezbollah with “Iranian arms flowing through Syrian territories.”

Hezbollah spokesman Hussein Rahhal would not comment on whether Nasrallah, whose movements are kept secret, was in Damascus. However, Rahhal was dismissive of the Kuwaiti newspaper report.

Palestinian President Mahmoud Abbas, speaking in Rome after meeting with Italian Premier Romano Prodi, said intense negotiations were under way to free an Israeli soldier captured by Hamas-linked militants. However, a Palestinian lawmaker and a spokesman for the Hamas military denied that the soldier’s release could be imminent.

With cease-fire efforts stalemated, Rice – who was in Malaysia after a trip to Beirut, Jerusalem and the Rome conference – said she was prepared to make a second tour of the Middle East. No timetable was announced.

“I am more than happy to go back,” Rice said, if her efforts can “move toward a sustainable cease-fire that would end the violence.”

In his interview with Army Radio, Ramon, the justice minister, said the Israeli air force must bomb villages before ground forces enter, suggesting that this would help prevent Israeli casualties. Ramon spoke a day after nine soldiers were killed in house-to-house fighting. Hezbollah acknowledged Thursday that it lost five fighters in the same clashes, though Israel said at least 30 were killed.

Asked whether entire villages should be flattened, he said: “These places are not villages. They are military bases in which Hezbollah people are hiding and from which they are operating.”

Thousands of civilians are believed trapped in southern Lebanon, according to humanitarian officials.

International Red Cross spokesman Hisham Hassan said their teams that have visited border villages under heavy bombardment have found families hiding in schools, mosques and churches, or huddled together in homes they hope will withstand the barrage.

“But even the residents we speak to can’t say how many are there, because everyone’s hiding, they don’t know who’s dead or alive,” he said.

AP correspondent Zeina Karam in Beirut, Lebanon contributed to this report.

AP-ES-07-27-06 2347EDT

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