They said that Israel was trying to present an isolated incident regarding the capture of a soldier, while ignoring their "regular snatching of Palestinians from their home." There were "thousands" of Palestinians held without trial, including women and children.

Jfjfp spokesman Dan Judelson said the prominent Jews "simply do not see how Israel can defend attacking civilian targets such as water works and power supply." "There are those in the community who say that Jews should not criticize Israel. But Israel is damaging itself through this kind of action," Judelson said.

He told the BBC that many people believed the attacks on Palestinian infrastructure "were less about liberating Cpl Shalit and more about seeking a pretext to over-throw Hamas." Their petition criticized the response by the US and its allies in calling for restraint as "desperately inadequate." It was a situation that requires "determined action by the international community," it warned.

"We watch with horror the collective punishment of the people of Gaza. Everything reasonable must be done to secure Corporal Gilad Shalit's safe release but nothing Israel is doing contributes to that aim," it warned.

The Jewish leaders called on the British public to write to their MPs to demand that the UK government breaks its silence and acts "to achieve an immediate ceasefire." Their community leaders were also urged to write to the Israeli Embassy to "make them understand their actions are wrong, their explanations unconvincing."

AFTER a week of fierce fighting against Palestinian militants in Gaza, the Israeli government was last night facing growing unease within its own military over the refusal to negotiate with Hamas for the release of kidnapped soldier Corporal Gilad Shalit.

But there was little sign of Israeli prime minister Ehud Olmert changing his stance yesterday when he rejected a Hamas call for a ceasefire after a bloody week in which more than 30 Palestinians, mainly militants, and one Israeli soldier were killed following Shalit's kidnapping.
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The United Nations secretary-general Kofi Annan appealed to Israel and the Palestinians to "pull back from the brink for the sake of all civilians in the region".

He called on Israel to halt what he said was the disproportionate use of force, demanded Shalit's release, and reminded both sides of their humanitarian obligation to spare civilians from violence.

Israeli forces yesterday withdrew from most of the northern Gaza Strip, where the fierce fighting has been centred, but clashes erupted near Gaza City, leaving at least five Palestinians dead, including a six-year old girl after an airstrike hit a house.

The move was not expected to be a complete end to the violence. "We are acting at our own discretion and we do not rule out a return to these areas," an army spokesman said. "The operation is not over."

Meanwhile, Olmert's refusal to budge on the issue of negotiating with Hamas was starting to raise questions among senior military ranks. Military sources said it was Israeli Defence Force (IDF) policy "to do anything to rescue a soldier" but efforts to pursue negotiations were being hamstrung by a prime minister's office determined to take a hard line.

Since the 1970s, the policy has been to pursue a military response but also be open to negotiating - either if there is seen to be no military alternative or as a parallel strategy. "The prime minister's hardline stance could lead to unnecessary loss of life on both sides," said one official. "All parties - Olmert, [Palestinian president] Mahmoud Abbas, Egypt and Hamas - know what the package is. The time has come for all of them, especially Israel, to come to the table and start talking."

Hamas officials have also blamed Olmert's office for stalled negotiations, saying Israel was refusing to respond to Hamas's "legitimate demand for the release of prisoners in exchange for Shalit's release".

For the first time since the crisis began, Israeli public security minister Avi Dichter suggested on Friday that Israel might release Palestinian prisoners as part of an Egyptian proposal to free kidnapped 19-year-old Shalit. Dichter said that once Shalit was released and militants stopped rocket attacks from Gaza, "then, in a goodwill gesture, Israel, as it has in the past, knows how to free prisoners".

But other Israeli ministers denied there would be negotiations. "We have no comment, except to say that Israel is prepared to take whatever steps necessary to bring the soldier home but will not give in to blackmail," said David Baker, a spokesman for the prime minister's office.

Palestinian prime minister Ismail Haniyeh of Hamas issued a five-point ceasefire proposal, calling on Israel to halt its offensive and release prisoners but saying little about what Hamas was prepared to do in return.

The Israelis brushed aside the truce offer. "We will not negotiate with hostage-takers," Israeli Foreign Ministry spokesman Mark Regev said.

Dr Boaz Ganor, a leading Israeli expert on counter-terrorism strategy from the Herzliya Interdisciplinary Centre, said the Israeli government and Hamas were now restricted by harsh statements made at the outset of the crisis.

"Such hardline comments from both Israeli and Palestinian leaders have defined public opinion, so the window of opportunity to resolve this crisis is in danger of disappearing," Ganor said. "In Olmert's case, it depends if his tough stance is either a tactical manoeuvre or strategic. If it is strategic, it is a mistake."

Ganor argued the key issue was for both parties to use a negotiating opportunity "to bring a bigger cake to the table". "For Israel, it would be the chance to insist that Palestinians end all rocket attacks and cease all other terrorist activities against Israeli citizens, and for the Palestinians to demand Israel stops targeted assassinations and ends all military activity in Gaza," he said.

Fierce fighting broke out yesterday morning as Israeli tanks approached the outskirts of Gaza City. But at the same time, Israeli troops withdrew from northern Gaza "since the immediate goals of the operation in that area had been achieved", said a spokesman for the IDF.

Palestinian witnesses said two Palestinians, including a policeman, were killed during clashes that also saw Israeli aircraft firing missiles at gunmen on the edge of the densely packed neighbourhood of Shijaia - a stronghold of the governing Hamas movement.

Israeli officials said the latest offensive was prompted by the discovery of another tunnel they said was to be used by Hamas militants to smuggle weapons and carry out another raid in Israeli territory.

In the Israeli city of Ashkelon, north of the Gaza border, residents were coming to terms with now living on "Israel's new frontline" after rockets hit city locations, including a schoolyard.

Nobody was injured, but with one of the country's largest power plants in its southern districts, along with Israel's only desalination plant, there is now fear among its 120,000 citizens that the next attack will result in sizeable fatalities.

While the southern edge of Ashkelon had been hit before, its centre was still considered out of range until last Tuesday, when a rocket launched by Hamas militants hit the heart of the city.

"Today, Ashkelon; tomorrow, Tel Aviv," said Roni Mehatzri, the mayor of Ashkelon, pointing out that his city was only an hour's drive south from Tel Aviv. "If Ashkelon is under attack, then the whole of Israel is under attack," he said.

Outside the mayor's office, Yamit Elimaliach was buying ice-cream for her two children. The 30-year-old mother said she and her husband had just bought a flat in Ashkelon.

"Yes, it's scary, and while we're determined to stay, I'll be honest that if these attacks had happened just before we bought our home, we would have changed our minds."

Mahmoud Abbas, the Palestinian president, told reporters that Israel had agreed to withdraw from Gaza and free some prisoners in return for Cpl Shalit's freedom.

The minister said the release of Palestinian prisoners would be conditional on the cessation of Palestinian attacks on Israel. Mr Dichter's comments suggest an acceptance of the proposals of Hosni Mubarak, the Egyptian president, to resolve the crisis.

Israel has killed about 40 Palestinians in Gaza to secure the release of Cpl Shalit and halt the firing of rockets at Israel. But despite the attacks, the main efforts in freeing the soldier have been made by foreign diplomats outside Israel and Gaza.

Earlier this week Mr Mubarak travelled to Saudi Arabia to request the help of King Abdullah to ask Syria to bring pressure to bear on Khaled Meshal, a Hamas leader in Damascus. Palestinian diplomats say the captors of Cpl Shalit have become more reasonable and accepted a prisoner exchange would not be simultaneous.

Violence continued in northern Gaza as Israeli tanks took up new positions in Beit Lahiya. Palestinians fired rockets at Israel and the army fired hundreds of shells at northern Gaza. Four Palestinians were killed in air strikes yesterday after a day of fighting which saw the death of 24 Palestinians and an Israeli soldier.

Israeli forces launched their offensive, the first such push into Gaza since troops and settlers withdrew from the territory last year, after Palestinian gunmen abducted Corporal Gilad Shalit in a raid into Israel on June 25.

Olmert rejected calls by the three militant factions that grabbed the tank gunner, including the governing Hamas group's armed wing, to release Palestinian prisoners in exchange for information about him, the official said.

The official quoted Olmert as saying such a move would strengthen Hamas at the expense of "moderate elements" in the Palestinian Authority.

Palestinian chief negotiator Saeb Erekat urged international aid organizations to help avert "human catastrophe" in Gaza.

Israeli forces have destroyed a main power station there and killed about 50 people, including 20 civilians, residents said.

UNITED NATIONS

The offensive has been criticized by the European Union and United Nations, but those organizations wield far less influence on Israel than its main ally, the United States, which has led an international aid boycott of the Hamas-led government.

"Let's remember who started this," UnderSecretary of State Nicholas Burns told CNN. "It was the outrageous actions of Hamas in violating Israel's sovereignty, in taking the soldier hostage."

The EU said it was gravely concerned about the humanitarian situation in Gaza and urged Israel to help in allowing aid to be delivered there.

"The presidency of the European Union expresses its grave concern about the deteriorating humanitarian situation in the Gaza Strip," said a statement from Finland, which currently holds the rotating EU presidency.

In the latest violence, an Israeli aircraft fired missiles at a car carrying two militants near the southern Gaza town of Rafah, killing a bystander and wounding a gunman and four civilians, Palestinian security officials said.

A second air strike in northern Gaza blew up a van filled with explosives belonging to Hamas militants, destroying it, but the gunmen fled before the blast and five bystanders were hurt, witnesses and medics said.

An Israeli army spokeswoman confirmed the attack.

Earlier Israel bombed a key bridge in northern Gaza.

The army said the goal was to prevent militants from transporting Qassam rockets to launch sites.

But a rocket slammed into a street in the Israeli town of Sderot, wounding one person, the army said. A second Qassam damaged a house in the border town, while a third fired after dark damaged a hothouse.

Israeli tanks left much of northern Gaza on Saturday but soldiers remained in the southern part of the territory and have deployed close to the outskirts of Gaza City.

Haniyeh said Israel's withdrawal from Gaza and a halt to military actions could "make it easy for us to end the crisis" over Shalit.

Israeli cabinet minister Meir Shetreet countered: "Let them return the soldier home safely, stop the Qassams, then no problem -- we leave Gaza."

Underscoring how far the sides were from a deal on the soldier was an opinion poll published by the Jerusalem Media and Communications Center that showed 77 percent of Palestinians backed Shalit's capture.

Yet 47 percent thought the crisis was doing the Palestinians more harm than good, the survey found, illustrating the strong emotions generated by the continuing conflict.