* Israelis and Palestinians battle in Gaza * Palestinian civilians bear brunt of bloodshed * Olmert says Israel will prevent humanitarian crisis * International ceasefire calls fail to make progress By Nidal al-Mughrabi GAZA, Jan 4 (Reuters) - Israeli troops and tanks split the Gaza Strip and ringed its main city on Sunday in an offensive against Hamas that has killed 500 Palestinians, including a growing number of civilians. Israeli tanks poured shells and machinegun-fire into suspected militant positions and war planes struck as Hamas fighters fought back with mortars and rockets. Hamas kept up rocket attacks against southern Israel, defying efforts by the Middle East's most powerful army to achieve Israeli leaders' declared aim of removing the threat of cross-border salvoes. Israeli Prime Minister Ehud Olmert told French President Nicolas Sarkozy in a phone call that Israel would continue to allow in aid supplies to prevent a humanitarian crisis in Gaza. Sarkozy arrives in Jerusalem on Monday to push for a truce. European Union foreign policy chiefs launched a mission to seek a ceasefire in the Hamas-run Gaza Strip but acknowledged they faced a difficult task. Israeli President Shimon Peres rejected the possibility of a ceasefire but said Israel did not intend to occupy Gaza. "We shall not accept the idea that Hamas will continue to fire and we shall declare a ceasefire. It does not make any sense," Peres told U.S. broadcaster ABC. At least 42 Palestinians, most of them civilians, were killed on Sunday as Israeli shells slammed into houses and Gaza's main shopping district, medical sources said. Israel has accused Hamas of using civilians in the Gaza Strip as "human shields", saying the Islamist group has been firing rockets at Israel from densely populated areas and storing weapons in homes and mosques. A foreign Red Crescent doctor said: "Civilians are being killed ... shells are severing people's legs, shrapnel is going into people's bodies and into people's homes, a lot of people are being cut down. Everyone is terrified." Medics said three Palestinian rescue workers were killed by Israeli fire on Sunday, raising to seven the total number of medical staff who have died in nine days of bloodshed. The Saturday night invasion of the Hamas-ruled Gaza Strip followed a week of Israeli bombardments from land, sea and air -- the most serious Israeli-Palestinian fighting in decades. Palestinians said soldiers moved deep into Beit Lahiya in the northern Gaza Strip and asked residents to leave their homes to avoid being hurt in the fighting. Some families sought refuge in U.N.-run schools in neighbouring Beit Hanoun. Gaza medical officials said the total Palestinian death toll in Israel's "Operation Cast Lead" rose to 512. A U.N. agency said at least a quarter of the dead were civilians. A Palestinian human rights group put the figure at 40 percent. One Israeli soldier was killed and 32 were wounded in the ground offensive, Israel said. Four Israelis have been killed by the Hamas rocket strikes since Dec. 27. ISRAELI THRUST Israeli officials said the operation, which had sparked a wave of protests around the world, could last many days. Witnesses said the Israeli thrust cut the territory in half from the border fence to the Mediterranean. Troops and armour had taken up positions around Gaza City itself. Calls for a ceasefire from the United States, Israel's main backer, other governments and the United Nations failed to gain traction over disagreements about who should stop firing first. Sunday morning saw gun battles between Hamas fighters and Israeli soldiers but later the action was mostly Israeli tank shelling and Hamas rocket and mortar fire. "The Zionist enemy must know his battle in Gaza is a losing one," Abu Ubaida, a spokesman for Hamas's armed wing, said. An Israeli officer in Jerusalem said: "I would say that most of the resistances that we faced were from mortar shells and other things but not from serious Hamas fighters face-to-face." The Israeli military said aircraft attacked dozens of targets, including smuggling tunnels, weapons caches and mortar squads. Dozens of Hamas fighters were hit, it added without being more specific. Heavy civilian casualties in the territory packed with 1.5 million people could increase international pressure on Israel to halt its biggest operation in Gaza in four decades. But the fighting also holds political risks for Israeli leaders before a Feb. 10 election, especially if its forces take heavy casualties in street fighting. In southern Israeli towns, schools and malls remained closed and many streets were eerily empty. The plight of Gaza residents was desperate. People have taken shelter in their homes for days and humanitarian agencies said water, food and medical supplies were running short. The emir of Qatar, a U.S. ally, on Sunday said that Israel's attack on Gaza amounted to a war crime and renewed calls for an emergency summit of Arab countries. Israeli government officials said Israel wants to weaken Hamas and establish deterrence so the group would think twice before firing cross-border salvoes. It also hopes to win international backing for new security arrangements along the Egyptian-Gaza border to prevent Hamas from rearming. In the occupied West Bank, the Executive Committee of the Palestine Liberation Organisation reiterated that peace talks with Israel could not continue as long as the assault went on. Iranian-backed Hamas is estimated to have about 25,000 fighters. Israel has not said how many troops are involved in the operation but thousands of reservists were on stand-by. Hamas called off a six-month truce last month and stepped up its rocket attacks, citing Israeli raids and a continuing blockade of the enclave Israel quit in 2005. International peace efforts aimed at creating an independent Palestinian state foundered after Hamas won elections in 2006 and drove Fatah forces loyal to Palestinian President Mahmoud Abbas from Gaza a year later. (Writing by Angus MacSwan; Editing by Sami Aboudi)
Demonstrators shout slogans during a protest against the ongoing Israeli attacks on Gaza in the Puerta del Sol in central Madrid January 4, 2009. Israeli troops and tanks split the Gaza ...
Egypt
