STORY: Video obtained by Reuters shows the rubble following what Palestinians said was an Israeli airstrike in the city of Rafah in the Gaza Strip.

And it comes amid what seem to be dwindling prospects for ceasefire talks in Cairo.

Israeli Prime Minister Benjamin Netanyahu on Sunday flat-out rejected what he said were Hamas's demands for a potential truce.

Netanyahu said the Palestinian Islamist group wanted the removal of all Israeli forces from Gaza, and a permanent end to the fighting, which would leave Hamas in power.

He said, "the State of Israel cannot accept that."

Hamas meanwhile, blamed Israel for the impasse. In a statement, Hamas chief Ismail Haniyeh accused Netanyahu of "sabotaging efforts made through the mediators."

A Palestinian official close to the mediation effort told Reuters on Sunday: "If Netanyahu doesn't change his mind, there will be no reason to stay."

And the fighting continues: Israel soldiers at the Kerem Shalom crossing between Gaza and Israel inspected armored vehicles after Hamas claimed it had attacked the position on Sunday.

Earlier in the day trucks carrying desperately-needed humanitarian aid passed through the crossing. But following the attack, Israel said the crossing had been closed.

The war began after Hamas stunned Israel with a cross-border raid on Oct. 7 in which Israel says 1,200 people were killed and over 250 hostages taken.

More than 34,600 Palestinians have been killed in Israel's subsequent assault, according to Gaza's health ministry. The bombardment has devastated much of the coastal enclave and caused a humanitarian crisis.

Israel has been warning for months it plans to send troops into Rafah, the southern city bordering Egypt where more than a million displaced Gaza residents have taken refuge. Israel believes thousands of Hamas fighters are holed up in the city, along with potentially dozens of hostages.

The United Nations on Friday warned such an operation would potentially put thousands more lives at risk.

The Israeli military on Sunday released video of Defense Minister Yoav Gallant meeting commanders in Gaza.

Gallant said there were signs Hamas did not intend to reach an agreement. He said, "this means strong military action in Rafah will begin in the very near future, and in the rest of the Strip.

But the deadlock in Cairo continues to turn up the heat on Netanyahu.

Thousands of Israelis protested on Saturday, demanding the prime minister accept a ceasefire agreement with Hamas that would see the remaining hostages brought home.