Mahmoud Abbas, the Palestinian president, swore in a new emergency government in the West Bank today, a move denounced as “illegal” by the dismissed Hamas premier Ismail Haniyah, whose Islamic movement has taken control of the Gaza Strip.

As the two rival Palestinian governments traded barbs, Israeli forces moved into positions inside the northern Gaza Strip in response to Hamas’ violent sweep to power. The Israeli company that provides fuel to Gaza also shut off deliveries for all depots inside Gaza except those feeding power stations.

Israel and the international community have rallied around Mr Abbas’ secular Fatah leadership – which has lost control of the Gaza Strip – and moved to stifle the new fiefdom established there by Hamas, who were described yesterday by Saeb Erakat, the chief Palestinian negotiator, as “gangsters” who had carried out a coup d’etat.

But Hamas likewise decried the new emergency government headed by former World Bank technocrat Salam Fayyad for executing a “coup” against the Hamas government which came to power 18 months ago in democratic elections.

Facing total isolation in the Gaza Strip, Palestinians started panic buying basic commodities like flour over the weekend, with prices spiking by as much as 20 percent before the leadership threatened tough punishment, including confiscation of property, of any merchants caught stockpiling or price gouging.

Hundreds of people have tried to flee across the borders into Israel. The Israeli authorities have closed the border crossings, refusing to have any truck with Hamas, which calls for the Jewish state’s destruction. Adding to the seclusion, West Bank police chiefs have warned that any Fatah border police who return to work with the Hamas regime will be seen as mutineers.

With Gaza’s 1.4 million people trapped in the 140 square mile coastal strip and facing imminent shortages, Mr Fayyad, the new prime minister in the West Bank, said his emergency government’s first task was to address the security situation.

“The mission will be difficult and hard, but not impossible,” he said.

Even as the shutters were coming down around Gaza, doors have been opening up to the West Bank as the international community rushed to shore up Mr Abbas’ new government of moderates. Washington, which had refused to provide any funding for the Palestinians while Hamas was in power, said it would lift a ban on direct financial aid to the new emergency government, clearing the way for the European Union and Israel to follow suit.

"There won't be any obstacles economically and politically in terms of re-engaging with this government ... They will have full support," Jacob Walles, the US consul-general, said.

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