Israel has approved a potential assault on the Gaza city of Rafah while also keeping ceasefire hopes alive with plans to send another delegation to Qatar for talks on a possible hostage deal with Islamist militant group Hamas.
Israeli Prime Minister Benjamin Netanyahu's office on Friday said he had authorised a plan to attack the city on the southern edge of the shattered Palestinian enclave where more than half of its 2.3 million residents are sheltering after five months of war.
Global allies and critics have urged Netanyahu to hold off attacking Rafah, fearing mass civilian casualties. But Israel says it is one of the last strongholds of Hamas whom it has pledged to eliminate and that residents will be evacuated.
In Washington, White House national security spokesperson John Kirby said the United States had not seen the Rafah plan, but would like to. He told a regular briefing a Hamas ceasefire-for-hostages proposal was within the bounds of what was possible and expressed cautious optimism about it.
Hamas has presented a Gaza ceasefire proposal to mediators and the US, which includes release of Israeli hostages in exchange for freedom for Palestinian prisoners, 100 of whom are serving life sentences, according to a proposal seen by Reuters.
A statement from Netanyahu's office on the Rafah attack plan said Hamas' demands for the release of hostages remained unrealistic, but an Israeli delegation would still head to Doha once the security cabinet had discussed its position.
The Israeli statement said the Israeli Defence Force was "preparing operationally and for the evacuation of the population" of Rafah.
It gave no time frame and there was no immediate evidence of extra preparations on the ground.
US Secretary of State Antony Blinken told reporters in Austria the US needed to see a clear plan from Israel for Rafah, including to get civilians out of harm's way.
Negotiators failed this week to reach a ceasefire agreement in time for the Ramadan Muslim holy month. Washington and Arab mediators are still determined to reach a deal to head off an assault on Rafah and let in food to stave off starvation.
Israel has rejected claims of genocide, saying it is purely focused on destroying all Hamas fighters.
There is increasing friction between Washington and Israel, which officials in President Joe Biden's administration say is waging war with too little care for civilians.
In the centre of Gaza City late on Friday, an Israeli air strike destroyed a seven-storey residential building, killing or wounding several people, the spokesman of the civil emergency service there said. He said emergency workers were searching the rubble for casualties.
More than two weeks after receiving an Israeli-approved proposal for a truce, Hamas on Thursday gave mediators its first formal counter-proposal in more than a month.
Like previous proposals from both sides, the offer, reviewed by Reuters on Friday, foresees dozens of Israeli hostages being freed in return for hundreds of Palestinians held in Israeli jails, during a weeks-long ceasefire that would let in aid.
Hamas also called for talks in a later stage on ending the war, but Israel has said it is only willing to negotiate a temporary truce.
Though Israel did not accept, its description of the terms as "still unrealistic" was notably milder than its response to the previous Hamas offer last month, which Netanyahu called "delusional".
The war began with an attack by Hamas Islamist fighters from Gaza who killed 1200 people and seized 253 hostages in Israel on October 7, according to Israeli tallies. Since then, an Israeli assault has killed more than 31,000 people, according to Palestinian figures, and driven nearly the entire population of Gaza from their homes.
The United Nations says a quarter of Gazans are on the verge of famine and on Friday, the first ship bringing aid by sea, the Open Arms, arrived off Gaza.
In one of the worst reported incidents yet, Gaza health authorities said at least 21 people had been killed and 150 wounded at a queue for aid near Gaza City on Thursday night and blamed Israeli forces for shooting into the crowd.
Israel denied its troops were to blame and said Hamas fighters had opened fire. Reuters was not able to independently confirm either account.
