An Israeli air strike in Gaza City has caused heavy casualties Tuesday.

Palestinian medics say nine people were killed, including two children. Israel says its aircraft attacked a van carrying Palestinian militants on the way to fire rockets into southern Israel.

Witnesses say at least 20 people were wounded, and they report two of the dead were members of the group Islamic Jihad. Two Israeli missiles - one of which hit the militants' van - caused the carnage.

Palestinian President Mahmoud Abbas denounced Israel's aerial attack as "state terrorism," and called on the international community to act immediately "to put an end to Israeli aggression."

In Jerusalem, Israeli Defense Minister Amir Peretz says Israeli forces no longer feel any need to use restraint in their operations against Palestinian militants.

Peretz said Israel will "act with all [its] might" against any hostile militant group.

Palestinian militants in Gaza have launched frequent rocket attacks against Israel in recent days, and the Jewish state has responded with missile strikes and artillery fire. The bloodshed today, however, was much greater than from most other retaliatory attacks.

The violence in Gaza has escalated sharply since an explosion on a Gaza beach last week killed eight Palestinian civilians. Reports in Israel say an investigation is likely to conclude that Israeli forces were not responsible for the blast.

A military committee is expected to formally release its findings later today. Israeli officials who spoke on condition of anonymity say the report will conclude that explosives planted by the Palestinian militant group Hamas caused Friday's seaside explosion. An examination of shrapnel removed from two wounded Palestinians at Israeli hospitals is said to have concluded that the explosives were not made in Israel.

Palestinians blamed Israel for last week's civilian deaths, and pictures of a Palestinian girl weeping over her father's body sparked worldwide condemnation of the violence.

Israeli military officials have expressed regret for innocent civilians' suffering, but they have not accepted responsibility for the explosion.

Some information for this report was provided by AFP, AP and Reuters.