2:15PM: Here's a detailed account of yesterday's clash which draws on some of the issues I have raised.
The August 3, 2010, armed clash along the Israeli-Lebanese border was a significant strategic incident.
On Thursday, July 29, 2010, Israel notified UNIFIL that a few Israeli soldiers would be crossing the security fence in order to cut a tree and remove a few shrubs in Israeli territory but near the Blue Line (the actual border between Israel and Lebanon). This foliage blocks the view of Israeli security cameras positioned deep inside Israel. Israel also notified UNIFIL that these soldiers would be escorted by a small patrol which would stay south of the security fence.
The Israeli notification was in accordance with UNSC resolution 1701. UNIFIL then informed the nearby positions of the Lebanese Armed Forces about the planned Israeli activities in order to ensure that there was no misunderstanding. The Lebanese Army notified the local HizbAllah force.
Significantly, the Lebanese Army unit deployed along the border with Israel is the 9th Division, whose commanders and troops are Shi'ites and recruited from the same manpower pool as the HizbAllah.
Around 10:30am on August 3, 2010, about 10 Israeli soldiers with saws crossed the gate in the security fence on foot. This detachment was covered by an Israeli patrol which included a few tanks, armored vehicles, and a command vehicle. As UNIFIL had been informed, the patrol stayed 200-300 meters south of the fence.
When the soldiers approached the tree, they were attacked by small arms automatic fire from both the Lebanese Army's position just across the border and "civilians" (HizbAllah fighters) in the nearby village of Adissyeh.
Immediately, a few Israeli commanders ran from the command vehicle toward the fence to see what was happening. Snipers hiding in the bush adjacent to the Lebanese Army position fired on them, killing the Israeli battalion commander (a lieutenant-colonel) and critically wounding the company commander (a captain). The sniper fire came from a professional ambush that had been organized on the basis of the advance warning provided by UNIFIL.
Meanwhile, the shooting at the Israeli soldiers north of the fence intensified. Israeli forces opened small-arms and mortar fire on the sources of fire in the Lebanese Army position and in a couple of unfinished houses in Adissyeh. Two Israeli tanks and an armored personnel carrier moved forward toward the fence in order to evacuate the stranded soldiers. At this point a UNIFIL patrol arrived on the scene and the UN officers urged both sides to ceasefire. The firing stopped a few minutes later.
Escorted by the UN patrol, the two Israeli tanks and the armored personnel carrier continued to advance toward the gate in the fence in order to evacuate the soldiers. Suddenly an anti-tank missile was fired from either the Lebanese Army position or the bush immediately near it. The missile barely missed the UNIFIL vehicle and the tanks. The Israeli tanks opened fire on the missile launcher.
Major activity followed. Intense fire small arms, heavy machineguns, mortars, and RPGs was opened from both several Lebanese Army positions as well as HizbAllah positions in Adissyeh. Israel rushed additional tanks and artillery to the area and started bombarding all Lebanese positions. One or two Katyusha rockets were launched toward Israel, impacted in open space and caused no damage.
A pair of Israeli combat helicopters arrived on the scene. They attacked the main Lebanese Army position near Adissyeh, and subsequently the Lebanese Army battalion headquarters in the village of Al-Taybeh. The helicopters also attacked and destroyed several Lebanese Army armored vehicles which were parked near the headquarters. Three Lebanese soldiers and a journalist (from the pro-HizbAllah newspaper Al-Akhbar) who was with the troops in Al-Taybeh were killed. Another soldier was killed in the position near Adissyeh. A total of five to six soldiers were wounded. There is no reliable information about HizbAllah casualties.
The fire subsided after little over two and a half hours.
This was a very serious incident for two reasons:
1. The incident started as a pre-planned pre-meditated provocation against the Israeli patrol on the basis of information provided via UNIFIL. The mere invitation by the Army of the Al-Akhbar correspondent to cover the clash suggests that this was a pre-planned incident. The incident was conducted jointly by Lebanese Army forces and HizbAllah forces, proving that the close cooperation which HizbAllah leader Hassan Nasrallah had boasted about repeatedly is indeed working (at least with the Army's Shi'ite units such as the 9th Division).
2. Earlier, on Monday, August 2, 2010, HizbAllah and Iranian media warned that the Israeli cabinet had considered "the prospects of an upcoming war on the Lebanese, Syrian and Gaza fronts in anticipation of tensions on the Lebanese domestic scene" because of the impending indictment of senior HizbAllah officials by the Special Tribunal for Lebanon (STL). The HizbAllah, Syria, and Iran are calling on all Lebanese to ignore the STL and instead rally and close ranks behind the "Resistance" in order to confront the Israeli threat. Under these circumstances, the incident on the Israeli-Lebanese border should be considered a made-to-order "proof" of the HizbAllah and Iranian warnings.
Indeed, Lebanese President Michel Suleiman denounced the fighting and urged the Army and all Lebanese to "stand up to Israel's violation of Resolution 1701, whatever the price". According to the Syrian Arab News Agency, Syrian Pres. Bashar al-Assad stated that the "Israeli attack proves once again that Israel is constantly working to destabilize security in Lebanon and the region. Syria stresses that it is standing by its sister Lebanon in the face of the criminal Israeli aggression and calls on the UN to condemn and stop this aggression."
However, the main event in the aftermath of the clash is an anticipated major speech by Hassan Nasrallah. The speech was scheduled for 20:30 on August 3, 2010 (Lebanon time), but its exact time was being constantly changed. Senior HizbAllah officials predict that Nasrallah's speech "will mark a turning point" for Lebanon and the entire Middle East. They explained that Nasrallah would "focus on the national and Islamic dimension of the July  war" and its implications for the current situation in the entire region. Nasrallah's speech, the Senior HizbAllah officials stress, "will mainly be devoted to talk about the meaning of victory against Israel" in both past wars and in the historic confrontation still to come.
Given the above, the August 2, 2010, rocket firing from southern Sinai of Aqaba, Eilat, and a base of the US-led Multinational Force & Observers Organization in Sinai might also be part of this kind of made-to-order "proof" of Israeli aggression. Significantly, the six 122mm GRAD rockets fired from Sinai were made in Iran or North Korea, strongly suggesting that the perpetrators were Iran-sponsored main group rather than a Palestinian fringe entity.