I think if true (and I read this on the israeli new site as well) it's a really bad move on LH's behalf.
The route has offered a L/H product for years and while I'm sure people can live with losing F on a 4 hour flight, losing the L/H business is a very different matter.
I know plenty of Senators traveling the route for connections and i can't see them sticking with LH if the route goes S/H.