Israeli forces clashed with Hamas gunmen in southern Gaza tonight after tanks entered the Palestinian territory in pursuit of militants who have been pummelling southern Israel with rocket fire, witnesses said.

Hamas fighters unleashed small arms and mortar fire at forces backed by helicopters that entered the strip near the Kissufim crossing, east of the town of Khan Yunis, according to reports.

Palestinian security sources said Israeli troops were laying siege to a house of a member of Islamic Jihad in the village of al-Karara, several hundred metres from the border. There was no immediate comment from the Israeli army.

The incursion came as talks aimed at resolving the decades-old conflict remained in limbo, despite assurances given by Condoleezza Rice, that a peace deal could still be reached by the end of 2008.

During a visit to the region today, the US Secretary of State urged Ehud Olmert, the Israeli Prime Minister, and Mahmoud Abbas, the Palestinian President, to resume US-brokered negotiations.

Mr Abbas suspended negotiations on Sunday, after Israel launched Operation Warm Winter in the Gaza Strip, killing more than 120 Palestinians. Israeli troops withdrew yesterday, but Israeli warplanes continued to hit suspected Hamas rocket-launching targets in Gaza.

“I call on the Israeli government to halt its aggression so that we can afford the necessary atmosphere to conduct the negotiations,” Mr Abbas said, without setting any timetable for resuming talks.

“The choking siege around Gaza has also sabotaged the negotiations. Therefore I call on the Israeli government to cease its aggression in order to provide the environment necessary for the negotiations.”

Dr Rice will continue to meet with officials in Jerusalem tomorrow. Her visit had been planned to gauge progress on the peace process after President Bush’s recent visit to the region. But in light of the violence in Gaza, Dr Rice was expected to concentrate on simply getting the talks back on track.

A senior Israeli Foreign Ministry official said it was unlikely that the latest round of violence would end soon, adding that Israel hoped that Mr Abbas would “understand” Israel’s need to defend itself.

Tzipi Livni, the Israeli Foreign Minister, suggested earlier that Israel could have no choice but to launch a wide-scale military incursion into the Gaza Strip.

“We cannot afford this kind of extreme Islamic state controlled by Hamas,” said Ms Livni. Israel unilaterally disengaged from the Gaza Strip in the summer of 2005. Last June, Islamic Hamas militants violently seized control of the costal area, increasing the flow of rocket attacks on southern Israel.

“Obviously the situation in Gaza is one that is concerning... Hamas is doing what might be expected, which is using attacks, rocket attacks on Israel to try to arrest a peace process in which they have nothing to gain,” said Dr Rice.

She also called for Israel to allow humanitarian aid to reach Gaza. Israel complied and allowed more than 160 trucks packed with aid and medical supplies to enter southern Gaza today.

In late January, Hamas operatives breached the border fence with Egypt, allowing hundreds of thousands of Palestinians to stream into Gaza, purchasing supplies and selling goods.

In a report published today, a coalition of humanitarian organisations concluded that the humanitarian situation in Gaza is worse now than it has been at any time in the past 40 years.

Amnesty International, Care International UK, Cafod, Christian Aid, Médecins du Monde UK, Oxfam and Save The Children UK gave warning that more than 1.1 million people are now dependent on food aid and of 110,000 workers previously employed in the private sector, 75,000 workers have now lost their jobs.

“The recent escalation in violence, both from rocket attacks and military strikes, will make life even more unbearable in Gaza,” said Geoffrey Dennis, Chief Executive of Care.

Water and sewage infrastructure is on the point of total collapse. Unless the blockade ends now, it will be impossible to pull Gaza back from the brink of this disaster and any hopes for peace in the region will be dashed.”

Times Recommends

• Should Knox’s trial even have reached the courtroom?
• 'Was it real?' The US bailout nightmare
• Iranian opposition plays the long game