Israel Warns Gaza Residents War Will 'Escalate'

Israel will step up its offensive on the Gaza Strip, and dropped leaflets there Saturday warning residents of its plan.

The fliers that fluttered down from Israeli air force jets warned of "a new phase in the war on terror" and said Israel will "escalate" its operation, which has already killed more than 800 Palestinians.

The notices were dropped as a "general warning," the army said Saturday.

Israel launched the offensive two weeks ago to halt years of Palestinian rocket attacks. The army says the operation is directed only at the ruling Hamas militant group. But Palestinian officials say roughly half of the casualties have been civilians.

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Meanwhile, Syria-based Palestinian militant groups including Hamas on Saturday rejected deploying international observers or troops in Gaza.

A statement issued by the groups after a meeting attended by Hamas political leader Khaled Mashaal also rejected any security arrangement that "infringes on the right of resistance against Israeli occupation."

The statement comes hours after Palestinian President Mahmoud Abbas called on Hamas, which controls Gaza, to reach an agreement to end the fighting.

Israeli forces pounded dozens of targets and edged closer to Gaza City on Saturday while southern Israel was largely spared militant rocket fire in one of its quietest nights in the offensive against Hamas.

The Israeli military said more than 15 militants were killed in heavy fighting Saturday with its ground forces inside Gaza. Its aircraft attacked more than 40 targets throughout Gaza, striking 10 rocket-launching sites, weapons-storage facilities, smuggling tunnels, an anti-aircraft missile launcher and gunmen. Flames and smoke could be seen rising into the sky over Gaza City.

Palestinian hospital officials confirmed only four deaths, but fighting has hindered paramedics from collecting bodies and treating the wounded.

Eight people were killed by Israeli tank fire Saturday in the town of Jebailiya, Palestinian medical officials said. The dead appeared to be civilians, paramedics on the scene said.

The Israeli army said it was investigating the incident.

Palestinian medical officials say more than 800 people have been killed in Israel's two-week offensive against Hamas militants in Gaza. Roughly half of the dead are believed to have been civilians.

The fighting raged after both Israel and Hamas ignored a U.N. resolution calling for an immediate and durable cease-fire that would lead to the withdrawal of Israeli troops from Gaza.

Israel has dismissed the Security Council resolution passed Thursday as impractical, while Hamas, whose government in Gaza is not recognized internationally, is angry it was not consulted about the diplomatic efforts.

Meanwhile, the Palestinian Authority president urged both Israel and Hamas to agree to an Egypt-brokered truce Saturday, but he singled out the Jewish state, saying it would be responsible for a "waterfall of blood" if it didn't accept the deal.

Abbas is in Cairo Saturday for talks with Egyptian officials on a truce to end the fighting in the Gaza Strip, now in its 15th day. In a news conference Saturday in Cairo after meeting with Egyptian President Hosni Mubarak, Abbas also stressed that there was no time to waste in ending the bloodshed in Gaza, home to 1.4 million people.

"If any party does not accept it (the truce), regrettably it will be the one bearing the responsibility, and if Israel doesn't want to accept, it will take the responsibility of perpetuating a waterfall of blood," Abbas said.

Some of the heaviest fighting Saturday occurred on the strategic coastal road north of Gaza City, Palestinian security officials said. Israeli forces moved to within about 1 mile of the city before pulling back slightly.

While Israel has largely taken control of the road, militants continue to operate from hidden positions in the area. The road is often used to fire rockets into Israel or attack Israeli navy boats off the Mediterranean coast.

Israel launched the offensive on Dec. 27. A week later, ground troops moved in, with artillery and tank fire that has contributed to a surge in civilian casualties.

Thirteen Israelis have been killed — four of them by militant rockets, the rest in battle in Gaza. Five soldiers were lightly wounded in Saturday's fighting.

In a possible sign of progress for the military, no rockets were fired into Israel overnight, a sharp drop from the dozens of projectiles that were launched in the early days of the offensive.

Israeli military officials cautioned against reading too much into the lull, and by Saturday morning, several rockets had landed in Israel. Two struck the southern city of Ashkelon, lightly wounding two people, authorities said.

The offensive has caused extensive damage throughout Gaza, fueling fears of an impending humanitarian crisis. The United Nations estimates two-thirds of Gaza's 1.4 million people are without electricity, and half don't have running water.

The Israeli military said it would halt the fire in Gaza for three hours on Saturday to allow the territory's besieged residents to leave their homes and stock up on supplies.

It is the third time in recent days that Israel has suspended its offensive to allow aid groups to work.

But the groups say three hours isn't enough time. Salam Kanaan of Save the Children said in previous lulls, for instance, the agency distributed food to 9,500 people — far short of the 150,000 people it serves.

U.N. official Adnan Abu Hasna said the Palestinian refugee agency would distribute aid to about 40,000 people, half of them holed up in U.N. schools that have been transformed into shelters.

All deliveries were coming from existing supplies already in Gaza. U.N. officials said a halt on aid shipments into Gaza through Israeli-controlled border crossings remained in effect. The ban was imposed Thursday after a U.N. truck driver was shot and killed by Israel. It was unclear when the deliveries will resume.

"As each day goes by, and for each moment that the cease-fire demanded by the Security Council is not observed, the crisis continues," said U.N. spokesman Chris Gunness.

Israel says any cease-fire must include assurances that Hamas will halt attacks and end the smuggling of weapons into Gaza through the porous Egyptian border.

Hamas has said it won't accept any cease-fire deal that does not include the full opening of Gaza's border crossings. The U.N. resolution emphasized the need to open all crossings, which Israel and Egypt have kept sealed since Hamas militants forcibly seized control of the territory 18 months ago.

Israeli leaders oppose that step because it would allow Hamas to strengthen its hold on Gaza.

The Associated Press contributed to this report.