With Iran-backed Hezbollah on the defensive after a series of heavy Israeli blows, the United States and Iran are locked in a showdown over Lebanon's future, analysts said.

Hezbollah, the most powerful regional force backed by Iran, which arms and finances it, has long held sway in Lebanon.

Just a month ago, Dahieh's bustling streets were packed with traffic, families strolling about and youths in cafes, but now silence dominates the abandoned Hezbollah bastion, interrupted only by the sound of Israeli bombs.

Escalating Israeli attacks since late September, after nearly a year of low-intensity cross-border exchanges, have reduced much of the Lebanese capital's once densely-packed southern suburbs to rubble and sent many of its residents fleeing.

U.N. peacekeepers in Lebanon said the Israeli army "deliberately" damaged one of their positions in southern Lebanon, in the latest incident reported by the force that remains deployed in all positions.

An Israeli "army bulldozer deliberately demolished an observation tower and perimeter fence of a U.N. position in" southern Lebanon, UNIFIL said in a statement, adding that its forces remain in all positions "despite the pressure being exerted."

Lebanese state media has accused Israel of planting explosives and detonating buildings on a wide-scale in three border villages, as all-out war between Israel and Hezbollah neared its one-month mark.

"The Israeli occupation army is carrying out a large-scale bombing operation in buildings in the towns" of Adaisseh, Markaba and Rab Tlatine, the National News Agency reported after Israel's Defense Minister said Israel was "destroying" Hezbollah in south Lebanon.

Hezbollah said it had downed an Israeli drone Sunday, without saying where, after Lebanon state media reported heavy Israeli strikes across the country targeting branches of a financial institution linked to the group.

With U.S. mediator Amos Hochstein scheduled to arrive in Beirut on Monday amid major escalation in Lebanon, Parliament Speaker Nabih Berri has stressed that this visit is "the last chance before the U.S. elections to reach a solution" in the country.

Israel's Defense Minister Yoav Gallant said on Sunday that the military was stepping up its strikes targeting Hezbollah in southern Lebanon near the Israeli border.

The Lebanese Army said three soldiers were killed in an Israeli strike on Sunday on their vehicle in southern Lebanon. There was no immediate comment on that from the Israeli military, which said it struck more than 100 Hezbollah targets in southern Lebanon in the past day and continued ground operations there.

Israeli airstrikes were targeting Beirut's southern suburbs on Sunday night, after the Israeli army warned that it would target Hezbollah's al-Qard al-Hassan financial institution in Haret Hreik, Shiyyah, Ghobeiri, Choueifat, Tahwitat al-Ghadir and Burj al-Barajneh.

The National News Agency reported 11 strikes on Beirut's southern suburbs, many of them targeting al-Qard al-Hassan. Other strikes hit the association in Lebanon's eastern Bekaa Valley and in the country's south, NNA added.

Hezbollah’s Deputy Secretary-General Sheikh Naim Qassem has been residing in Tehran after fleeing Lebanon on an Iranian plane over two weeks ago, the UAE-based Erem News outlet reported, quoting an anonymous Iranian source.