Israel Hits Un Refugee Agency in Gaza

The headquarters of the UN refugee agency and a hospital in Gaza were on fire today after being struck by Israeli artillery, injuring several people, a UN spokesman and witnesses said.

The compound of the UN Relief and Works Agency was hit by what appeared to be three white phosphorous shells, with three people known to have been hurt, a spokesman for the organization, Chris Gunness, said. It was on fire, with large amounts of aid supplies, including fuel trucks, at risk, he added.

The compound has been serving as a shelter for hundreds of people fleeing the 20-day Israeli offensive. It was not clear if any people remained inside.

Another UN spokesman in Gaza told the AFP news agency that the organization was suspending its relief operations following the attack.

The UN secretary general, Ban Ki-moon, who is in Israel today on the latest leg of a peace mission, expressed his "strong protest and outrage" at the attack on the UN building and called for an investigation. Speaking in Jerusalem, Ban said he had been told by Israel's defence minister, Ehud Barak, that the shelling was a "grave mistake".

Separately, AFP quoted witnesses as saying that a wing of the Al-Quds hospital in south-west Gaza, where hundreds more people had taken shelter early today from advancing Israeli tanks, was on fire after being struck. It was not clear if there were any injuries.

Even as the first signs of progress towards a ceasefire emerged from Egyptian-led negotiations, Israel increased the intensity of its attack striking dozens of sites across Gaza overnight and today.

Reuters reported that a missile or shell had struck the Gaza tower block where the news agency and other media organisations have offices. The 13th floor of the Al-Shurouq Tower, which houses Abu Dhabi television, appeared to have been hit, injuring one of its journalists.

Israeli forces were reported to be closing in on the outskirts of Gaza City, forcing thousands more Palestinians to flee their homes. Palestinian witnesses said Israeli tanks fired shells at least three high-rise buildings in downtown Gaza City.

It is not clear whether this morning's offensive marks another major escalation in the conflict or a brief foray – so far Israel has avoided sending grounds troops into the heart of Gaza City.

A senior Israeli defence ministry official, Amos Gilad, was due in Cairo to assess an Egyptian proposal for an initial 10-day ceasefire. Hamas reportedly agreed in principle to a ceasefire but last night, the Islamist movement submitted its own conditions.

"There is no disagreement with the Egyptian leadership. The issue is differences over how to deal with the Zionist enemy through the clauses of this initiative," said Salah al-Bardawil, a Hamas official.

With the Palestinian death toll now above 1,000, Israeli tanks again pressed deep into the Tel al-Hawa suburb in the southern area of Gaza City overnight. There was more heavy fighting to the east of the city, which is now effectively surrounded. One set of air strikes ignited a large fire in northern Gaza which burned for several hours, sending a thick cloud of acrid black smoke into the sky. An airstrike killed three people close to the apparently-empty home of the senior Hamas leader, Mahmoud Zahar.

The Israeli military said it struck 70 sites across Gaza overnight, including a mosque in the southern town of Rafah, which it said was used to store rockets. At least 11 soldiers were injured. Palestinian militants in Gaza fired at least 15 rockets into southern Israel early today, though there were no reports of injuries.

The Palestinian death toll rose to 1,028, with around 4,700 injured. On the Israeli side, 13 people have been killed, among them three civilians.

An Israeli decision on whether to accept the ceasefire or escalate the offensive will not come until Gilad has returned to Israel and briefed senior political leaders. Israel wants to ensure that Hamas halts its rocket fire and is unable to rearm itself in future.

The Egyptian proposal, which has been discussed for several days, appears to begin with a ceasefire of a week or 10 days, during which all fighting would stop but Israeli troops would remain on the ground in Gaza. Talks would then be held on the more difficult questions of stopping the smuggling of weapons to Hamas and lifting Israel's long economic blockade of the Gaza Strip.

However, it is thought Hamas's conditions for any deal would probably include an immediate withdrawal of Israeli forces the moment a ceasefire begins. That may prove too much for Israel to accept. Hamas also wants an Israeli commitment to lift the blockade on crossings into Israel, and to open the Rafah crossing into Egypt, and it wants the ceasefire to be limited to six months or a year.