Rice Says Peace Still Possible Despite Israeli Warning of More Violence

The US secretary of state, Condoleezza Rice, has said today she still believes a Middle East peace settlement and the creation of a Palestinian state to be possible by the end of the year, despite the Israeli prime minister, Ehud Olmert, warning yesterday that more fighting in Gaza was imminent.

Rice made her comments in Cairo on a stopover before heading to Israel this afternoon. Peace talks are in disarray after an Israeli military offensive killed more than 100 Palestinians in the Gaza Strip.

The Israeli offensive had been launched to stop rocket attacks by the Hamas militant groups on nearby Israeli cities, but the assault prompted the Palestinian president, Mahmoud Abbas, to suspend negotiations.

"There has to be an active peace process that can withstand the efforts of rejectionists to keep peace from being made. The people who are firing rockets do not want peace," Rice told reporters in Cairo. "They sow instability, that is what Hamas is doing."

Rice backed Israel's right to respond to the rocket fire but said it must avoid causing civilian casualties. She said the Hamas rocket attacks against innocent Israelis "need to stop" but also cautioned that Israelis "need to be aware of [the effect of their] operations on innocent people".

Though Israeli troops and tanks pulled out of Gaza before dawn yesterday, a senior Israeli official said the withdrawal was only a two-day interval in combat during Rice's visit. Israeli troops would remain close to the Gaza border.

The withdrawal ended five days of intense combat. At least 106 Palestinians and three Israelis have been killed. The fighting was criticized by many in the international community, including the UN. Israel's leading human rights group, B'Tselem, which has researchers on the ground in Gaza, said at least half the Palestinian dead "did not take part in the hostilities".

Yesterday Olmert said one of his goals was to "weaken" the Islamist movement Hamas. However, despite the heavy loss of life among both its militants and civilians, Hamas claimed a victory. Militants continued firing rockets from Gaza into Israel, many towards the nearby town of Sderot but also some of a longer range towards the larger city of Ashkelon, 11 miles to the north.

In the Gazan town of Jabalia yesterday, crowds poured on to the streets. Funeral tents were set up outside houses as workmen began to repair electricity cables and rebuild walls. More families emerged with stories of civilian casualties amid the combat. Louise Arbour, the UN human rights commissioner, called on Israel to carry out an impartial investigation into the Palestinian deaths.

More conflict appears inevitable. "We are in the midst of a combat action," Olmert was quoted as telling a parliamentary committee. "What happened in recent days was not a one-time event ... The objective is reducing the rocket fire and weakening Hamas."

Hamas is just as defiant. The group won Palestinian elections two years ago and went on to seize full control of Gaza last summer after a near civil war with the rival Fatah faction, led by Abbas, which now controls the West Bank. "Invading one inch of the Gaza Strip means the battle and confrontation will continue and will expand even further than it has reached," said Mahmoud Zahar, the most senior Hamas figure in Gaza. Palestinian rockets have killed 13 people in Israel since mid-2004, the most recent a civilian in Sderot last Wednesday.

On the main street in the Abed Rabbo district of Jabalia, close to the Israeli border, the damage was severe. Tank tracks had torn up the pavement and there were gaping holes in several houses. Twisted metal gates lay where they had been blasted off by soldiers who raided most of the homes.

One house targeted, on the corner of the main al-Quds Street, was home to the Abu Safi family. One of the younger sons, Hassan, 21, had been married seven days earlier. He was standing on the second floor balcony to make a mobile phone call at around 8am on Saturday when he was shot dead with a single bullet to the head.

"We didn't see the soldiers until they had shot him," said one of his brothers, Yahya, 26. The family insist neither he nor others in the house were fighters and there were none of the insignia that usually marks a militant's funeral.

Half an hour after the shooting Israeli soldiers forced their way into the building and entered the apartment. "They went in and saw his blood and they walked through it," said Mohammad Abu Safi, 32, the oldest brother. "That was very hard for us."

The soldiers searched the flat and the family, finding nothing. "They asked: Are you Hamas? I said, Of course not. We're businessmen." Abu Safi showed his identity card and his Palestinian Chamber of Commerce card. The soldiers confiscated their mobile phones and, the family say, took several hundred shekels, too. "They never apologized for killing my brother," he said. "At the end, one patted my father on the back and said: 'God bless him.'"