BEIRUT (Reuters) - Rockets fired by Hizbollah guerrillas killed eight people in the Israeli city of Haifa on Sunday and bombs shook Beirut as Israel pursued a five-day-old assault in Lebanon aimed at crippling the Shi'ite Muslim group.
It was Hizbollah's deadliest rocket strike in at least 10 years and the highest death toll in Israel since 11 people were killed in a suicide bomb blast in Tel Aviv in April.
Israeli Prime Minister Ehud Olmert said Hizbollah's actions would have "far-reaching" consequences for Lebanon.
Hizbollah said the attack was retaliation for Israel's killing of civilians and destruction of Lebanese infrastructure.
"After the Zionist enemy exceeded all limits killing and destroying ... the Islamic Resistance announces that it bombarded the city of Haifa with dozens of Raad 2 and Raad 3 rockets at 9 a.m. (0600 GMT)," Hizbollah said in a statement.
Israeli medics said more than a dozen people had also been wounded in Haifa, Israel's third largest city. It was hit by at least five rockets, including one that struck a train station.
Israel's campaign in Lebanon, launched after Hizbollah captured two Israeli soldiers and killed two on Wednesday, has drawn only a mild plea for restraint from the United States, which blames Hizbollah and its allies, Syria and Iran.
U.S. President George W. Bush, speaking at a G8 summit in Russia, characterised Israel's actions as self-defence and did not back Lebanon's pleas for an immediate ceasefire.
"Our message to Israel is defend yourself but be mindful of the consequences, so we are urging restraint," said Bush, who has blamed Hizbollah for the conflict in Lebanon.
Bombs crashed into Beirut's Shi'ite Muslim southern suburbs in overnight raids which set fire to Hizbollah's al-Manar television complex and nearby buildings, witnesses said. The station's signal twice disappeared briefly before returning.
The United States earlier blocked any move by the U.N. Security Council to demand a ceasefire, saying the focus for diplomacy should be on the summit in St Petersburg.
French President Jacques Chirac called for a ceasefire and "a show of moderation". British Prime Minister Tony Blair said the way to calm the violence was to tackle the reasons behind it, blaming Hizbollah and its allies Syria and Iran.
Israel's onslaught, which has killed more than 100 people, all but four of them civilians, is meant to force Lebanon to dislodge Hizbollah from its southern border strongholds.
The casualties in Haifa brought to 12 the number of people killed in northern Israel by hundreds of Hizbollah rockets that have rained down in the past five days.
In another statement, Hizbollah threatened to attack Haifa's petrochemical plants if Israel continued to "commit follies".
Israel's bombing campaign, which has laid waste to Lebanon's vital installations, is its most destructive assault since a 1982 invasion to expel Palestinian guerrillas.
Israel has said Lebanon must implement a U.N. resolution demanding the disarming of Hizbollah, a Shi'ite group formed in 1982 to fight an Israeli occupation that lasted 22 years.
But the Beirut government, led by an anti-Syrian coalition, lacks the unity and firepower to tackle Hizbollah, the only Lebanese faction to keep its guns after the 1975-90 civil war.
Hizbollah has said it wants to swap the two captured Israeli soldiers with Lebanese and Arab prisoners in Israel's jails.
The campaign in Lebanon coincided with an offensive Israel launched in the Gaza Strip on June 28 to try to retrieve another captured soldier and halt Palestinian rocket fire.
Israel widened the assault on Sunday, killing a Palestinian civilian in southern Gaza and three militants in the north.
The operation has piled pressure on the Palestinian government led by Hamas, which demands a prisoner swap for the Israeli corporal.
Israeli armour, backed by helicopters firing machineguns, moved in darkness into farmland near Beit Hanoun, as militants blew up hidden bombs and fired anti-tank grenades.
Three gunmen were killed in an Israeli air strike. At least 10 Palestinians were wounded in that and other air attacks.
Israeli troops had pulled out of the northern Gaza Strip a week earlier after a major raid into the territory, which Israel abandoned in 2005 after a 38-year occupation.
(Additional reporting by Nidal al-Mughrabi in Gaza, the Jerusalem bureau, Irwin Arieff in New York, David Clarke, Steve Holland and Sophie Louet in St Petersburg)
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