And it raises the Q, why the h… did you buy tickets with Iberia for a BA flight? It only complicates situations like this. I can somehow understand the BA agent as you booked w/ Iberia and Iberia took the payment from you. If BA reissue on 125 ticket stock BA will not get payment from Iberia but regardless have to foot payment to El Al.

IB is not going to resolve this as it is not their flight that was cancelled.