* Obama signals continued U.S. support for Lebanon
* Tough bargaining ahead on Lebanese government
* Violence possible if Hezbollah does not get veto (Adds comments by U.S. official, paragraph 7, analyst, paragraphs 16-17, Nasrallah, paragraph 18)
By Arshad Mohammed
WASHINGTON, June 8 (Reuters) - The victory of pro-Western forces in Lebanon’s elections is a relief for U.S. officials, sparing them a nettlesome decision on how to deal with a coalition led by Iranian- and Syrian-backed Hezbollah.
In a surprise, Saad al-Hariri’s anti-Syrian bloc won 71 of parliament’s 128 seats, against 57 for an opposition alliance that groups Shi’ite factions Hezbollah and Amal with Christian leader Michel Aoun, according to Lebanon’s interior minister. [ID:nL8701647]
In advance of Sunday’s elections, U.S. officials from Vice President Joe Biden on down made clear they would reassess U.S. aid, notably to the Lebanese armed forces, if Hezbollah and its allies prevailed over the "March 14" anti-Syrian political alliance.
The United States has formally designated Hezbollah as a "foreign terrorist organization," a status that bars U.S. assistance to the group or its members.
"The good news for Washington is that there is no need to adjust policy (in) style or substance," said Bilal Saab, a Lebanon expert with the Brookings Institution think tank who advises the U.S. government on Lebanon.
"There won’t be champagne ... but there sure will be sighs of relief," Saab added.
"There are a lot of things to be pleased about," a senior State Department official, speaking on condition that he not be named, told reporters. "Of course, we do welcome the fact that the March 14 majority was able to prevail."
U.S. President Barack Obama said the United States "will continue to support a sovereign and independent Lebanon" — a statement that U.S. officials said signaled U.S. aid to Lebanon was likely to keep flowing.
U.S. officials, however, said they would not make such decisions until a new government is formed and its policies — and aid priorities — are decided.
The United States has given the Lebanese armed forces more than $500 million since the 2005 assassination of former Prime Minister Rafik al-Hariri, seeking to build up an institution eroded by decades of sectarian strife and foreign influence.
The assassination triggered an international outcry that led neighboring Syria to end its 29-year military presence in Lebanon and gave rise to the March 14 alliance led by Saad Hariri, the son of Rafiq Hariri. [ID:nL8629164]
The alliance is named after the date of a huge rally against Syria’s military presence in 2005.
The victory by the March 14 bloc sets the stage for tough bargaining among all the parties over forming a consensus national government and whether Hezbollah would receive a blocking veto, as it has demanded.
Analysts said Hezbollah was likely to get what it wanted, saying that if it did not it could portend protracted gridlock and possible violence.
"It will be very difficult to move forward without having some kind of consensus government formed, which by extension ... implies that Hezbollah will want a blocking veto. It’s my sense that that would be necessary in order to attract them into the government," said Middle East and North Africa analyst Mona Yacoubian of the government-funded United States Institute of Peace think tank.
"If not, I think we are back to (a) sort of dangerous paralysis," Yacoubian added.
"I think that we are in a moment of danger," said Elliott Abrams, an analyst at the Council on Foreign Relations think tank who served on the White House National Security Council under former President George W. Bush.
"Having lost the elections, Hezbollah now has to rely on its strength as a terrorist group to remind Lebanese of its power, and the danger is that it will do something to remind them that it is still ... the single most powerful entity in Lebanon," Abrams added.
Hezbollah leader Sayyed Hassan Nasrallah said he accepted the election results "with sportsmanship and in a democratic way."
Several analysts warned against casting the victory by the March 14 bloc as a massive setback for Iran and Syria.
"You have to be careful not to read too much into this. Iran is not a superman and the United States is not without its own interests and capabilities," said Jon Alterman, director of the Middle East program at Washington’s Center for Strategic and International Studies think tank.
"I don’t think this is anything more than the end of a round, it’s not a decisive defeat for anybody," he added. (Editing by Will Dunham)