U.S. Officials: Hezbollah Training Iraqi Shiite Militia Group

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A terrorist group that warred with Israel this summer has been training militants in Iraq and in Lebanon, raising fears of destabilization in a divided Iraq, officials said on Tuesday.

Hezbollah, the Iranian-backed group in Lebanon, has been aiding Shiite cleric Muqtada al-Sadr's militia, senior intelligence officials confirmed, following a New York Times report that some 1,000 to 2,000 Shiites had been trained.

Click here to view the New York Times article.

"The Iranians and the Syrians should help — not destabilize — this young democracy," said President Bush, who is in Europe to attend a NATO summit.

Hezbollah on Tuesday denied the charges.

"These accusations are hollow and worthless. They reflect the American occupation's impasse in Iraq, where it is trying to blame others for its defeat," said Hussein Rahhal, Hezbollah's media chief.

The intelligence official quoted in the Times story said Iran was facilitating the connection between Hezbollah and the Mahdi Army, which has been accused in sectarian killings in Iraq.

The report came as U.S. officials are stepping up their accusations that Iran and Syria, which also backs Hezbollah, are fueling Iraq's spiraling violence by backing militants.

In Lebanon, Hezbollah is challenging U.S.-backed Prime Minister Fuad Saniora, demanding it and its allies be given more power in the ruling coalition or else they will bring down his government.

Henrietta Fore, U.S. Department of State undersecretary for management, met Tuesday with Saniora and underlined Washington's support for his government.

"I reaffirmed the strong support of the United States to work with the government of Lebanon and the Lebanese people to realize their aspirations for a peaceful and prosperous, sovereign and secure country," she said.

In other comments at the NATO summit, Bush expressed his administration's reluctance to talk with Syria and Iran and on the grounds that the two nations have been unhelpful in efforts to achieve Middle East peace.

Bush added that the United States will only deal with Iran when it suspends its program of enriching uranium, which could be used in a nuclear weapons arsenal.

Iran, the top U.S. rival in the region, has reached out to Iraq and Syria in recent days — an attempt viewed as a bid to assert its role as a powerbroker in Iraq, according to U.S. officials.

Officials said this latest revelation about Hezbollah comes after months of reports that Iran was "stirring up trouble" in Iraq by providing military logistics, financing and other assistance.

FOX News' Brett Baier and The Associated Press contributed to this report.