The CIA's operations in Lebanon have been badly damaged after Hezbollah identified and captured a number of U.S. spies recently, current and former U.S. officials told The Associated Press. The intelligence debacle is particularly troubling because the CIA saw it coming.

Hezbollah's longtime leader, Sheik Hassan Nasrallah, boasted on television in June that he had rooted out at least two CIA spies who had infiltrated the ranks of Hezbollah, which the U.S. considers a terrorist group closely allied with Iran. Though the U.S. Embassy in Lebanon officially denied the accusation, current and former officials concede that it happened and the damage has spread even further.

In recent months, CIA officials have secretly been scrambling to protect their remaining spies - foreign assets or agents working for the agency - before Hezbollah can find them.

To be sure, some deaths are to be expected in shadowy spy wars. It's an extremely risky business and people get killed. But the damage to the agency's spy network in Lebanon has been greater than usual, several former and current U.S. officials said, speaking on condition of anonymity because they were not authorized to speak publicly about security matters.

The Lebanon crisis is the latest mishap involving CIA counterintelligence, the undermining or manipulating of the enemy's ability to gather information. Former CIA officials have said that once-essential skill has been eroded as the agency shifted from outmaneuvering rival spy agencies to fighting terrorists. In the rush for immediate results, former officers say, tradecraft has suffered.

The most recent high-profile example was the suicide bomber who posed as an informant and killed seven CIA employees and wounded six others in Khost, Afghanistan in December 2009.

Last year, then-CIA director Leon Panetta said the agency had to maintain 'a greater awareness of counterintelligence'. But eight months later, Nasrallah let the world know he had bested the CIA, demonstrating that the agency still struggles with this critical aspect of spying and sending a message to those who would betray Hezbollah.

The CIA was well aware the spies were vulnerable in Lebanon. CIA officials were warned, including the chief of the unit that supervises Hezbollah operations from CIA headquarters in Langley, Va., and the head of counterintelligence. It remains unclear whether anyone has been or will be held accountable in the wake of this counterintelligence disaster or whether the incident will affect the CIA's ability to recruit assets in Lebanon.

In response to questions about what happened in Lebanon, a U.S. official said Hezbollah is recognised as a complicated enemy responsible for killing more Americans than any other terrorist group before September 2001. The agency does not underestimate the organization, the official said.

The CIA's toughest adversaries, like Hezbollah and Iran, have for years been improving their ability to hunt spies, relying on patience and guile to exploit counterintelligence holes.

In 2007, for instance, when Ali-Reza Asgari, a brigadier general in the Islamic Revolutionary Guards Corps of Iran, disappeared in Turkey, it was assumed that he was either killed or defected. In response, the Iranian government began a painstaking review of foreign travel by its citizens, particularly to places like Turkey where Iranians don't need a visa and could meet with foreign intelligence services.

It didn't take long, a Western intelligence official told the Associated Press, before the U.S., Britain and Israel began losing contact with some of their Iranian spies.