Fighting Intensifies As Olmert Says Israel is Nearing Its Goal

Israeli troops were last night pushing towards Gaza's towns and cities amid heavy fighting as Israel's prime minister, Ehud Olmert, said Israel was nearing its goals in the conflict.

Many Gazans in the outlying suburbs of Gaza City were moving into the center, desperately looking for apartments or shelter to escape the combat. Israel and Egypt have refused to open their borders to allow Gazans to flee the fighting.

About a dozen Palestinians, among them several gunmen, were killed early yesterday in Sheik Ajleen, close to the north of Gaza City, and troops were reported to be less than a mile from the city's southern neighborhoods last night. Tanks had moved towards the city, but then pulled back by the end of the day. At least 27 Palestinians were killed.

In a sign that a new phase of the offensive was near, Israel's military last night sent reserve units into the Strip. Brigadier General Avi Benayahu, the top military spokesman, said the units were already in Gaza, but he would not say if this meant the next stage was imminent - an invasion deep into the main towns and cities.

Olmert said the war in Gaza, now in its third week, would continue and he spoke out defiantly against the growing international criticism of Israel's killing of hundreds of Palestinians, many civilians. A UN security council resolution calling for an immediate ceasefire late last week did nothing to halt the conflict and diplomacy has moved only haltingly since.

"No decision, present or future, will deny us our basic right to defend the residents of Israel," Olmert told a cabinet meeting in Jerusalem.

Defence officials said Hamas had been damaged but that it was unlikely ever to admit defeat. Some Israeli generals were eager to invade Gaza's urban areas.

Major General Yoav Galant, head of southern command, said an escalation was a "once in a generation" opportunity to strike at Hamas. "If we don't do that we'll be missing an historic opportunity," he was quoted as saying in the Yedioth Ahronoth newspaper.

Khaled Meshal, the leader of Hamas who lives in exile in Damascus, said the offensive had ended any chance of a broader peace deal with the Palestinians.

Addressing Israel, Meshal said in a televised speech on Saturday: "You have destroyed the last chance for negotiations. No one will now believe you. What is needed is fierce resistance in Gaza and fierce support from the Arab, Islamic and international street until the aggression ends and the enemy withdraws."

Palestinian militants continued to fire rockets into southern Israel, several hitting the town of Be'er Sheva, though there were no serious casualties.

The Palestinian death toll rose to around 870 dead, of whom nearly half were women and children, with about 3,700 injured. On the Israeli side 13 people have been killed, three of them civilians.

The US president-elect, Barack Obama, described the death of civilians in the conflict as heartbreaking after being asked if his silence over the crisis could be interpreted as callousness.

"When you see civilians, whether Palestinian or Israeli, harmed, it's heartbreaking. Obviously what that does, it makes me much more determined to try and break a deadlock that has been going on for decades," he said on ABC television.

He vowed to act quickly after his inauguration to position the US as a trusted third party that could act as an interlocutor between the Israelis and Palestinians.

Israel's military admitted its bombing of a UN school last week, which killed 43 and injured 100 others, was the result of an Israeli mortar shell that missed its target by 30 metres. Previously the military had said militants inside the school compound were firing at their troops and that the troops simply returned fire.

Military sources were reported as saying that the UN school was clearly marked on the maps used by the troops.

Human Rights Watch said its researchers had seen Israeli forces using artillery-fired white phosphorus over densely populated residential areas of Gaza in violation of international humanitarian law. The weapon, used as a smokescreen, can cause serious burns. Israel has refused to detail which weapons are being used in the Gaza war, but says all its weapons are used within international rules.