[Source: Reuters]

Mediators from the U.S., Qatar and Egypt scrambled to forge a ceasefire between Israel and Hamas in their four-month-old war in the Gaza Strip after America’s top diplomat on a Middle East mission said there was still hope for a deal.

U.S. Secretary of State Antony Blinken said he saw room for negotiation, and a Palestinian Hamas delegation led by senior official Khalil Al-Hayya was due to travel on Thursday to Cairo for ceasefire talks with Egypt and Qatar.

Israeli Prime Minister Benjamin Netanyahu on Wednesday rejected Hamas’ latest offer, calling it “delusional,” and Hamas urged Palestinian armed factions to go on fighting.

Before heading back to the U.S., Blinken was due to hold meetings in Israel on Thursday, including with family members of hostages still held in Gaza who have clamoured for Netanyahu to make winning their freedom his top priority.

Hamas, the militant group that rules Gaza, proposed a ceasefire of 4-1/2 months, during which all hostages held in Gaza would go free, Israel would withdraw its troops from Gaza and an agreement would be reached on an end to the war.

The Hamas offer was a response to a proposal drawn up by U.S. and Israeli spy chiefs and delivered to Hamas last week by Qatari and Egyptian mediators.

Israel would be willing to let Hamas military leader Yahya Sinwar go into exile in exchange for the release of all hostages and an end to the Hamas government in Gaza, a half-dozen Israeli officials and senior advisers have told NBC News.

In response to the Hamas plan, Netanyahu renewed a pledge to destroy the Islamist movement, saying there was no alternative for Israel but to bring about its collapse.

Israel began its military offensive after Hamas militants from Gaza killed 1,200 people and took 253 hostages in southern Israel on Oct. 7.

Gaza’s health ministry says at least 27,585 Palestinians have been confirmed killed, with thousands more feared buried under rubble in Israel’s offensive since then.

In the only truce to date, lasting a week at the end of November, 110 hostages were released and Israel freed 240 Palestinian prisoners.

Netanyahu, whose domestic popularity is at rock bottom, faces public pressure to continue working with international mediators toward an agreement in Gaza.

A poll of Israelis released by a nonpartisan think-tank, the Israel Democracy Institute, this week found 51% of respondents believe recovering the hostages should be the main goal of the war, while 36% said it should be toppling Hamas.

Washington has cast the hostage and truce deal as part of plans for a wider resolution of the Middle East conflict, ultimately leading to reconciliation between Israel and Arab neighbours and creation of a Palestinian state.

Netanyahu rejects a Palestinian state, which Saudi Arabia says is a requirement for the kingdom to normalise relations with Israel.