Clashes between Israeli forces and Palestinian gunmen resumed in the city of Gaza today after the expiration of a three-hour truce to allow in humanitarian aid.
Residents of the northern Gaza Strip reported exchanges of fire between Israeli soldiers and Hamas fighters during the temporary truce period between 11am and 1pm Irish time. In Gaza city, hundreds had taken to the streets during the hiatus, shopping and visiting relatives.
Meanwhile, Israel has agreed to the principles outlined by Egypt for a ceasefire in the Gaza Strip but the two have yet to iron out key details about how it would be implemented, senior Israeli officials said today.
The Egyptian proposal calls for a halt to fighting as well as a drive to prevent Hamas from rearming, Israel's key condition.
"There is agreement on the principles but translating those principles into practical action is a challenge that is still ahead of us," a senior Israeli official said.
Israel wants a ceasefire deal to include a specialised international force to search out and destroy tunnels along the border between Gaza and Egypt to prevent Hamas from rearming and firing more rockets at Israeli towns.
A Palestinian official said the Gaza Strip's Hamas rulers, who want an end to Israel's blockade of the enclave, had been briefed in Egypt by Mr Mubarak and were debating the proposal.
"Aggression must stop, the siege must be lifted and the Zionist forces must pull out, and then we can talk about others issues, including calm and rockets," said Hamas spokesman Fawzi Barhoum.
US Secretary of State Condoleezza Rice said she had pressed Israel to seriously consider an Egyptian ceasefire plan as the UN Security Council weighed action to end Israel's attack on Gaza.
Ms Rice spoke by telephone today to Israeli Prime Minister Ehud Olmert and Foreign Minister Tzipi Livni and said she had detailed discussions with them on the conditions on the ground in Gaza as well as the Egyptian initiative.
"We're supporting that initiative. I've been in very close discussions with my Arab colleagues but also with the Israelis about the importance of moving that initiative forward," she said.
Ms Rice said she had also spoken to the Israelis about the need for a pause in violence, as happened today, to allow for humanitarian aid to get through.
"That needs to be repeated again and again," she said of the three-hour truce.
Ms Rice, who extended her visit to New York, also sought to convince Arab ministers at the United Nations there was no need to move ahead with a Libyan-drafted resolution which the United States and others view as strongly anti-Israeli.
French President Nicolas Sarkozy said earlier Israel and the Palestinian Authority had accepted a truce plan for Gaza. "The president is delighted by the acceptance by Israel and the Palestinian Authority of the Franco-Egyptian plan presented last night in Sharm el-Sheikh by (Egyptian) President (Hosni) Mubarak," said a statement from Mr Sarkozy's office.
"The head of state calls for this plan to be implemented as quickly as possible for the suffering of the population to stop."
In fresh fighting, at least 12 Palestinians were killed by Israeli attacks, medical workers said. At least 15 Hamas rockets hit southern Israel, causing no casualties.
The total Palestinian death toll reached 650, medical officials said. Israel says it killed dozens of militants this week in the offensive it launched on December 27th with the declared aim of silencing rocket salvoes.
According to UN figures, more than a quarter of the Palestinian dead are civilians. A Palestinian human rights group put the figure at 40 per cent. Seven Israeli soldiers and three civilians have been killed.
The United Nations called for an inquiry into Israel's deadly shelling of the UN school in Jabalya refugee camp yesterday. Israel said Hamas militants at the school had fired rockets. The UN said there were no gunmen on the premises.
An aide said Palestinian President Mahmoud Abbas, a bitter foe of Hamas, ordered officials to look into taking Israel to international courts over the deaths at the school.
Israeli government sources said Egypt was seeking an initial 48-hour ceasefire, during which it would put the finishing touches to its plan. Israel, the sources said, opposed a preliminary truce and wanted all the details of a ceasefire agreement completed first.
Javier Solana, the European Union's foreign policy speech, said by telephone from Tel Aviv that the EU was prepared to help Egypt prevent arms smuggling along its border with the Gaza Strip as part of a ceasefire with Israel.
With Washington in a transition period ahead of the January 20th inauguration of President-elect Barack Obama, France and its European partners, with backing from US allies in the Arab world, have been pushing hard for Israel to cease fire.
While it ordered a three-hour-long lull in "offensive" military operations to let in aid, Israel also considered entering a third stage of its air and ground offensive - a deep push into Gaza's cities and refugee camps.
But an Israeli official, citing the Egyptian and French ceasefire efforts, said Mr Olmert's security cabinet deferred voting on the urban warfare plan to an undisclosed date.
Fierce combat in Gaza's narrow alleyways and streets, leading to heavy casualties on both sides, would hold political risks for Israel's leaders ahead of a February 10th national election.