Israel Must Protect Civilians In Rafah, US Defense Secretary Says After Halted Weapons Shipment

Defense Secretary Lloyd Austin announced Wednesday before a hearing at the Senate that the U.S. has temporarily halted a shipment of high-payload munitions to Israel.

The decision reflects concerns over a potential large-scale military offensive in the Gazan city of Rafah, which could have significant humanitarian implications. It also underscores the growing discord between Israel and the U.S. where the Biden administration seeks to condition aid on commitments from Israeli Prime Minister Benjamin Netanyahu to limit civilian casualties.

The delayed arms shipment was set to include 3,500 bombs, divided almost evenly between 2,000-pound and 500-pound explosives, Reuters reported. These munitions are designed to enhance the precision of strikes, with technologies like the Joint Direct Attack Munitions and Small Diameter Bombs from Boeing Co. BA.

Austin emphasized the need for Israel to take greater precautions to protect civilians in Rafah. The U.S. is particularly worried about the potential for large-scale civilian casualties due to the dense urban environment in Rafah, where an estimated 1.4 million Palestinians are currently taking refuge.

"We've been very clear … from the very beginning that Israel shouldn't launch a major attack into the Rafah without accounting for and protecting the civilians that are in that battlespace. And again, as we have assessed the situation, we have paused one shipment of high payload munitions," Austin told a Senate hearing.

This is reportedly the first known case of the U.S. denying Israel military aid since the Israel-Hamas war began on Oct. 7, 2023.

Senator Jerry Moran (R-KS) questioned whether the pause in munitions could send a negative signal to Israel, a U.S. ally, and potentially embolden Iran and its allies

"We've not made a final determination on how to proceed with that shipment," Austin replied.

Netanyahu has not commented on the delay of the weapons shipment.

Shares of U.S. defense stocks, as tracked by the U.S. Aerospace & Defense ETF ITA, rose 1.1% Wednesday, hitting an all-time high since the fund’s inception in 2006. Boeing was 0.9% higher.

Humanitarian Situation Worsens In Gaza, Ceasefire Talks Resume

Scott Anderson, director of UNRWA Affairs in Gaza, reported that no fuel or aid has entered Gaza due to military operations, exacerbating a humanitarian crisis where over half of the population is facing extreme hunger.

The agency also added that an offensive on Rafah would compromise the only fully functional maternity hospital in the Gaza Strip.

Talks between American and Israeli officials regarding Rafah are ongoing, and U.S. concerns have not been fully resolved yet.

CIA Director William Burns visited Jerusalem on Wednesday to discuss Netanyahu’s strategy for Rafah and the ongoing ceasefire negotiations with Hamas.

Israeli-related stocks, as tracked by the iShares MSCI Israel ETF EIS, were up 0.2% during Wednesday’s morning trading in New York, on track to notch their fifth straight session of gains.

Oil prices inched higher by 1%, after the U.S. Energy Information Administration announced a decline in U.S. crude inventories last week.

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