By Maayan Lubell and Nidal al-Mughrabi
JERUSALEM/CAIRO (Reuters) -Israelis and Palestinians are signalling new efforts to forge a ceasefire deal, their first in a year, to pause the fighting in Gaza and return to Israel at least some of the 100 hostages still held in the Palestinian enclave.
The guarded optimism emerges as U.S. President Joe Biden's national security adviser Jake Sullivan holds talks with Prime Minister Benjamin Netanyahu in Israel on Thursday before heading to Egypt and Qatar, co-mediators with the U.S. on a deal.
A Western diplomat in the region said an Israeli deal with the Palestinian militant Hamas group was taking shape but was likely to be limited in scope, involving the release of only a handful of hostages and a short pause in hostilities.
A senior Hamas official, Basem Naim, said any U.S. official would have to apply "real pressure" to get Netanyahu and his government to accept a July 2 U.S. truce proposal and U.N. resolution which Hamas said it alone had accepted.
Such a truce would be only the second since the start of the war in October 2023. It would also enable the release of Palestinian prisoners held by Israel.
Israel's Mossad intelligence agency head David Barnea met Qatar's Prime Minister and Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani in Doha on Wednesday to discuss a ceasefire and hostage release deal, a source briefed on the meeting said.
Israel Defence Minister Israel Katz told his U.S. counterpart Lloyd Austin in a phone call on Wednesday there was now a chance for a deal that would allow the return of all the hostages, including seven U.S. citizens, Katz's office said.
Anything more than a limited truce remains unlikely so long as both sides stick to demands that have hampered numerous rounds of failed negotiations.
Hamas wants an end to the war before all hostages are freed, while Israel says the war will not end until the hostages return and Hamas no longer rules Gaza or constitutes a threat to Israelis.
"Since the first day of the negotiation, our decision has been clear: an end to the war on our people and exchange of prisoners. To achieve that we have shown all the flexibility and positiveness necessary and the mediators are our witnesses to that," Naim told Reuters.
The war began after Hamas gunmen stormed into Israeli communities on Oct. 7, 2023, killing around 1,200 people and taking about 250 hostages back to the enclave, according to Israeli tallies.
Since then, Israel's military has levelled swathes of Gaza, killing nearly 45,000 Palestinians, driving nearly all its 2.3 million people from their homes and giving rise to hunger and disease, according to Palestinian health authorities.
'HELL TO PAY'
U.S. President-elect Donald Trump has demanded Hamas release the hostages held in Gaza before he takes over from Biden on Jan. 20. Otherwise, Trump has said, there will be "hell to pay".
Trump's designated hostage envoy Adam Boehler has said he had spoken to Biden and Netanyahu.
Boehler told Israel's Channel 13 news last week: "I would appeal to those people that have taken hostages: Make your best deal now. Make it now because every day that passes, it is going to get harder and harder and more Hamas lives will be lost."
Although Biden and Trump are working separately, their efforts overlap and both stand to gain from a deal. A U.S. official said Trump's public statements about the need for a swift ceasefire "have not been harmful".
The official said the priority is to get the hostages home, whether at the end of the Biden term or the start of Trump's.
TIMING APT FOR NETANYAHU
The timing may never have been better for Netanyahu after Israel reestablished its reputation as the most powerful Middle East force with operations in Lebanon and Syria that weakened Hamas' Iranian-backed allies and left it isolated.
Netanyahu's once-fragile coalition has been strengthened by the addition of Foreign Minister Gideon Saar and his more centrist faction.
A Palestinian official close to the talks described what he called "a fever of negotiations" with ideas emerging on all sides, including among mediators in Egypt and Qatar and said Trump's involvement had given the talks a boost.