Israeli troops pushed deeper into the Rafah refugee camp (search) Thursday in search of gunmen and weapons smugglers, killing seven Palestinians and demolishing several buildings despite an international outcry over a deadly tank attack on a group of protesters.

At least eight Palestinians, many of them children, were killed by Israeli fire Wednesday as they demonstrated against the military operation. The sight of bloodied children and reports of overwhelmed doctors treating dozens of wounded people on blood-drenched hospital floors added to world anger.

Israel apologized for the deaths, saying its troops did not deliberately fire on marchers. A preliminary army investigation concluded that a warning shot fired by a tank flew through a building and hit the crowd, security sources said on condition of anonymity.

Israel also blamed the Palestinians, saying gunmen infiltrated the crowd of about 3,000 people protesting the incursion into the Rafah refugee camp. Witnesses denied militants were among the marchers, and Palestinian leaders denounced the incident as a massacre.

The U.N. Security Council (search) passed a resolution condemning the loss of life and Israel's demolition of homes. The United States abstained, the first time in nearly two years it did not exercise its veto on a resolution sharply critical of Israel.

Also Thursday, an Israeli court in Tel Aviv convicted Palestinian uprising leader Marwan Barghouti (search) of overseeing militant attacks that killed five people. Barghouti, a potential successor to Yasser Arafat (search), was acquitted of planning other attacks in which 21 Israelis died.

Barghouti's sentencing is set for June 6, and prosecutors asked for five consecutive life terms.

Brig. Gen. Ruth Yaron, the army's chief spokeswoman, said Thursday the Rafah offensive — dubbed "Operation Rainbow," it is the largest in Gaza in years — would continue until troops obliterate weapons-smuggling tunnels and round up militants along the Gaza-Egypt border.

By Thursday, the army moved into five neighborhoods in the camp, which is home to about 90,000 Palestinians. Exchanges of gunfire were reported, and Israeli Apache helicopters flew overhead.

Residents said Israeli troops demolished eight homes overnight and bulldozers moved into a street Thursday, knocking down two homes and a shop.

"I saw women and children running in the street," resident Mofed Matar said. "They were not able to evacuate any of their belongings."

The army, which said it was checking the report, said it only destroyed homes to uncover tunnels or flush out gunmen using them to attack Israelis.

Matar said the army ordered Palestinian men between the ages of 16 and 45 to surrender at a local school, waving white flags. The army said it was checking that report, too.

A similar mass surrender was ordered in another part of the camp Wednesday. The army said Thursday it had no Rafah men in custody.

Early Thursday, an Israeli missile strike killed three militants in the Rafah camp. The army said the gunmen were approaching Israeli forces.

Hours later, troops fired a tank shell and killed two militants, Palestinian doctors said.

Elsewhere, Rafah hospital director Dr. Ali Mousa said a 37-year-old man died from a gunshot wound to the head and two others, ages 29 and 22, were wounded. Relatives said the men were shot when they ventured onto the roof of their apartment building to check a water tank.

Another body was brought to the hospital Thursday, and the army said troops shot a gunman when he approached Israeli forces in the Tel Sultan area of Rafah

Also, a New York Times correspondent covering the invasin of the Rafah camp escaped a kidnapping attempt by Palestinians, raising concerns that foreign journalists may be facing a new danger in covering Israeli-Palestinian violence.

In the incident Wednesday night, assailants tried to grab James Bennet and force him into a car. Bennet said he screamed for help, and that Palestinian police arrived to help him. After a scuffle, the assailants fled, Bennet said.

Israel raided the Rafah camp less than a week after Palestinian militants killed 13 soldiers in Gaza, including seven along the Egyptian border.

Since Israel launched its operation early Tuesday, 39 Palestinians, including several children, have been killed. Dozens have been wounded, and refugee camp residents have faced power outages and a lack of water.

Local officials warned of a looming humanitarian crisis unless electricity and water supplies were restored.

Water from a well in Tel Sultan could not reach other parts of Rafah because there was no power, said Ashraf Ghonem of the Rafah water department. Israeli tanks prevented workers from repairing generators, he said, and he asked the army to guarantee safe passage to the workers.

"We want water to save our life. Is that too big to ask?" said Tel Sultan resident Salman Abu Jazar, 30. "My wife boiled the lavatory water to prepare the milk for our 11-month-old son."

Humanitarian groups called on Israel to ease its grip on Rafah. The International Committee of the Red Cross called on Israel to exercise "the greatest restraint" and ensure the wounded had access to adequate medical facilities.

Physicians for Human Rights said it petitioned Israel's Supreme Court to allow medical personnel to move freely and let the wounded be evacuated from Rafah.

It also accused the army of using a bulldozer to bury an ambulance that was headed to treat a mother and three children wounded by tank fire.

The army said the bulldozer was trying to clear the way for the ambulance, and it was working "24 hours a day" to facilitate humanitarian aid.

Near the West Bank town of Tulkarem, the army said it killed a Palestinian gunman after a shootout. Palestinian hospital workers confirmed that one man had been killed.

Palestinian officials also said a 13-year-old was shot dead by troops near the West Bank town of Hebron. The army said it fired on a Palestinian throwing a firebomb at soldiers.

In the West Bank town of Qalqilya, the army said troops killed an armed fugitive who tried to flee. It said it wounded a second militant who threw a firebomb, but it had no details on his condition.