The Lebanese government’s phased “Homeland Shield” plan, launched after the November 2024 U.S.-brokered ceasefire, remains the central driver of trader views on whether Hezbollah will formally commit to full disarmament by late 2026. Phase 1 south of the Litani River reached completion in early 2026, with the Lebanese Armed Forces deploying thousands of troops and removing thousands of weapons under U.S.-monitored verification. Phase 2, covering territory to the Awali River, received a renewable four-month mandate in February 2026, yet Hezbollah has publicly rejected the timeline and any extension of the process north of the Litani, framing it as serving Israeli interests. Israeli officials have described southern progress as insufficient, while U.S. pressure and the pending December 2026 end of the UNIFIL mandate continue to shape the negotiating environment. Direct Lebanon-Israel talks have been floated as a possible accelerator, but Hezbollah’s political and military posture inside Lebanon will determine whether the state monopoly on arms advances further by year-end.