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CNN: THE SITUATION ROOM July 13, 2006

Hezbollah Rockets

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BLITZER: Tom Foreman thanks very much for that good explanation.

A region in crisis indeed. And these tensions may not directly involve the United States, yet many Americans in the region may still be in danger. Our pentagon correspondent standing by with details, Barbara?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Wolf, the U.S. military has been watching this situation unfold all day long. They are concerned for a very good reason.

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STARR (voice-over): Bombed out runways at Beirut International Airport, now forcing the pentagon to plan for a worst case scenario. How to evacuate 25,000 Americans living in Lebanon without using the airport. Military officials tell CNN, it's just prudent contingency planning. But if an evacuation were ordered, it could involve sending in marines by helicopters from ships off shore in the Mediterranean.

Hours before Hezbollah rockets hit Haifa, Israel's third largest city, the U.S. navy had already pulled one of its small ships out of the harbor. Haifa is the southern-most point Hezbollah rockets have ever reached, hitting the city with a strategic port and oil refineries changed the military equation Israel says in its fight against Hezbollah.

DANIEL AYALON, ISRAELI AMBASSADOR TO THE U.S.: They have more than 10,000 rockets, medium range and longer rage. And Haifa, which is about 50 miles or so. 50 miles in the region is a strategic range. So, for the Hezbollah to do that, it's a major escalation.

STARR: Analysts say it's an indication that a Bush administration nemesis may be behind Hezbollah's increased military capability.

JOHN PIKE, DIRECTOR, GLOBALSECURITY.ORG: Iran, which is one of the manufacturers of this the primary source for these rockets, Hezbollah's primary source for these rockets, is doing a lot of work over the last 20 years or so to improve the quality of these rockets, their reliability, their accuracy and their range.

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STARR: The U.S. military clearly wants to stay out of this fight. But they are very aware of potentially Iran and Syria's involvement in backing Hezbollah. One source even telling us, that U.S. intelligence noticed just yesterday, a top Iranian military official was in Damascus -- Wolf?

BLITZER: All right Barbara, thank you very much, Barbara Starr at the Pentagon. Much more on this story coming up. We're going to tell you what's happening right now in the crisis in the Middle East. Also, how is the turmoil affecting oil prices? Guess what, they're reaching record highs today. But will they push even higher? And what are the political considerations in the conflict? We'll discuss all of that in our strategy session. That's coming up.

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