Israel's war against the Islamic militant group Hamas in the Gaza Strip ended four weeks ago, but a formal cease-fire remains illusive.
Israel's Cabinet gave an ultimatum to Hamas: no long-term cease-fire without the release of captive Israeli soldier Gilad Shalit, who has been held for more than two years in Gaza.
Cabinet Minister Meir Sheetrit said that in the first stage of any cease-fire deal, Shalit must be released. He added that Israel is prepared to pay the price. Sheetrit did not elaborate, but Hamas is demanding the release of at least a 1,000 Palestinian prisoners, including top militants, in exchange for the captive soldier.
Hamas accused Israel of scuttling an imminent cease-fire agreement that did not include a prisoner swap in the first stage. Hamas official Ali Barakeh warned Israel to accept Hamas's demand to open border crossings and lift its crippling blockade on Gaza in the first stage of the truce.
Barakeh said that Hamas still has a lot of rockets despite Israel's recent three-week offensive in Gaza.
He said that Palestinian groups prefer a cease-fire, but if necessary they are prepared to fight.
Israeli Cabinet Minister Shalom Simhon responded in kind.
He said if Hamas did not get the message the first time, Israel is prepared to launch a second Gaza offensive.
So the talk of an imminent cease-fire just two days ago has quickly regressed to the old language of mutual threats.