Israel's prime minister has expressed "deep sorrow" over the killing of four United Nations military observers by an Israeli air strike in Lebanon, and has ordered an investigation into the incident. The observers were from China, Finland, Austria and Canada. As many as 12 Israeli soldiers were killed Wednesday in heavy fighting in southern Lebanon.

Ehud Olmert

A statement from Prime Minister Ehud Olmert's office says the Israeli prime minister has told U.N. Secretary-General Kofi Annan of Israel's "deep sorrow" at the deaths of the observers.

At the same time, the statement says Israel is dismayed at Mr. Annan's comment that the U.N. post in Lebanon was deliberately targeted by Israel. Foreign Ministry spokesman Yigal Palmor says Mr. Annan's comments make no sense.

"Why on earth would we deliberately target U.N. observers?" he asked. "What good would that do either on the military or the political level, because it so obvious that this would be harmful. Of course it is a tragedy for the observers and their bereaved families and we truly share their sorrow and we deeply regret the incident. It was obviously a fatal mistake. The Army will be conducting an investigation and the results will be made public."

The deaths of the U.N. observers come as diplomats from the Middle East, Europe and the United States opened talks in Rome aimed at exploring ways to end the fighting in Lebanon. Lebanon, Arab nations and some European Union members have called for an immediate cease-fire. U.S. Secretary of State Condoleezza Rice, who is co-chairing the meeting, says any cease-fire must not leave Hezbollah in place to threaten Israel.

Diplomats meeting in Rome are discussing the possible deployment of international peacekeepers in southern Lebanon, an initiative that Israel supports, but one that could be made more difficult by the deaths of the U.N. observers. Yigal Palmor of Israel's Foreign Ministry says the observers deaths should not hurt the effort to bring stability to the region.

"I hope this will not be the case because if there is no international or interim force to enforce U.N. resolutions to help the Lebanese government enforce its authority than nothing will have been achieved by the international community," he said. "The concern here should be shared by everyone concerned about peace on the Israel - Lebanon border."

Israel says in the meantime it will establish a security zone in southern Lebanon to safeguard its northern border. However, Israeli troops suffered heavy casualties Wednesday in heavy fighting with Hezbollah militants in their effort to take control of the town of Beit Jbail, a Hezbollah stronghold four kilometers inside Lebanon. Hezbollah militants also continued firing rockets at northern Israel striking Haifa, and warning that cities further inside Israeli territory could be targeted.

Meanwhile at least a dozen Palestinians including a child were killed in clashes between Palestinian militants and Israeli troops in the Gaza Strip on Wednesday, one day after U.S. Secretary of State Condoleezza Rice met with Palestinian President Mahmoud Abbas in the West Bank. More than 100 Palestinians have been killed in the last month in Gaza. Saeb Erekat, a senior Palestinian official says Palestinians have become the forgotten victims in the latest crisis in the Middle East.

Saeb Erekat (file photo)

"What is happening in Gaza is horrible. I think we have become the forgotten war, the forgotten zone," he said. " I think war crimes are being committed in Gaza. The number of people who have been killed there in the last three or four days has reached 34 people."

Israeli officials deny targeting civilians in Gaza or elsewhere in the Palestinian territories, saying their operations in Gaza are designed to stop the firing of rockets into Israel, and find an Israeli soldier captured by Palestinian militants one month ago.