Updated Aug. 1, 2014 7:02 p.m. ET
A cease-fire meant to last three days and lead to talks on a lasting peace in the Gaza Strip collapsed Friday as heavy fighting erupted between Israeli forces and Hamas. Photo: EPA
Israeli forces spread across southern Gaza in search of a missing infantry officer who was presumed captured by militants Friday, as President Barack Obama blamed Hamas for the quick breakdown of a U.S.-brokered cease-fire.
The officer's fate added a volatile element to Israel's conflict with Hamas, with the potential to draw the military deeper into a densely populated Palestinian enclave largely devastated by 25 days of combat. If confirmed, his capture could give Hamas, the Islamist group that governs Gaza, powerful new leverage in its effort to end the fighting on its terms.
The officer, 2nd Lt. Hadar Goldin, disappeared in a fierce battle for control of an underground tunnel shaft that left two Israeli soldiers dead near Rafah, the military said. Israel responded with air and artillery strikes that leveled homes and killed at least 35 people in and around the city of Rafah, mostly women and children, according to Gaza's Health Ministry.
The fighting shattered a cease-fire, brokered by the U.S. and United Nations, that was barely 90 minutes old. Speaking at the White House, Mr. Obama expressed pessimism that an agreement to end the violence could be reached soon, and called on Hamas to release the soldier unconditionally and as soon as possible, although neither Israel nor Hamas have confirmed his capture.
Palestinians carry their belongings Friday after salvaging them from their destroyed houses in the heavily bombed town of Beit Hanoun, Gaza Strip. Associated Press
"I think it's going to be very hard to put a cease-fire back together again if Israelis and the international community can't feel confident that Hamas can follow through on a cease-fire commitment," he said at a news conference.
Mr. Obama also called on Israel to do more to avoid casualties among Palestinian civilians. "I have been very clear throughout this crisis that Israel has a right to defend itself," he said. "We have also been clear that innocent civilians in Gaza caught in the crossfire have to weigh on our conscience, and we have to do more to protect them."
Across Gaza, more bodies were collected from the rubble and fresh fighting took more lives, the health ministry said, pushing the overall Palestinian death toll up by more than 150 to 1,600.
The Israeli military says 63 of its soldiers have died, along with three civilians killed by rocket fire into Israel.
U.S. officials said they had hoped to use the initial 72-hour cease fire to open talks on the future status of Gaza, an impoverished coastal strip with 1.8 million people.
The new fighting threatened to upend or at least delay a scheduled round of indirect negotiations in Cairo between Israel and Hamas that had been arranged by U.S. Secretary of State John Kerry.
Hamas is demanding an immediate end to the economic blockade of Gaza by Israel and Egypt. Israel wants Hamas disarmed and Gaza demilitarized.
Israel began its Gaza offensive on July 8 with airstrikes aimed at degrading Hamas's rocket arsenal. The military sent in ground troops 10 days later to plug up a network of cross-border tunnels Hamas fighters have used to stage attacks inside Israel.
Prime Minister Benjamin Netanyahu has refrained from expanding the operation beyond those goals—wary, officials say, of a prolonged and costly campaign in Gaza. He had agreed to the cease-fire as a prelude to indirect talks with Hamas on Gaza's future.
Israeli soldiers check their weapons Friday at an army deployment area on the southern border with the Gaza Strip after a proposed three-day truce collapsed soon after it began. Agence France-Presse/Getty Images
Friday's apparent capture of Lt. Goldin opened a new front in the campaign. Lt. Col. Peter Lerner, a military spokesman, said ground forces and intelligence operatives mounted an extensive effort in and around Rafah to locate the soldier.
"It's a game changer for the prime minister because he's got to decide how much to increase the [military's] penetration into Gaza," said Gerald Steinberg, a political-science professor at Israel's Bar-Ilan University. "It's always been an Israeli principle not to leave soldiers on the battlefield."
A statement by Mr. Netanyahu's office said he had spoken by telephone with Mr. Kerry and told him "the Palestinians blatantly breached the humanitarian cease-fire" and attacked Israeli soldiers. "Israel will take all necessary steps against those who call for its annihilation."
Israel has gone to great lengths in the past to get its soldiers back, dead or alive, from enemy hands. In 2011 Israel traded 1,027 Palestinian prisoners for a single soldier, Gilad Shalit, captured five years earlier by Hamas-allied militants who had tunneled under the border from Gaza.
Hamas's underground network has vastly expanded since then, and its militants have used it several times during the current fighting to reach Israeli staging areas near the border and try to capture soldiers.
The terms of the cease-fire announced late Thursday by Mr. Kerry and U.N. Secretary-General Ban Ki-moon didn't preclude Israeli forces from continuing their destruction of the tunnels, as long as they held their fire.
Col. Lerner said Israeli troops were a conducting such an operation near Rafah about 9:30 a.m., an hour and a half into the cease-fire period, when a militant emerged from a tunnel and detonated an explosive vest. He said Lt. Goldin, 23 years old, was apparently taken in the ensuing battle.
A Hamas official initially said the group was holding an Israeli soldier, then retracted the statement. None of the smaller militant groups affiliated with Hamas claimed responsibility.
Fawzi Barhoum, a Hamas spokesman, said Israeli forces were the first to breach the truce when they opened fire near Rafah.
The cease fire had brought a brief window of morning calm to other parts of Gaza, enabling Palestinian families to trek back to neighborhoods where rows of homes have been reduced to rubble.
Egyptian officials said the invitation to negotiators still stood. Hamas said its negotiators, part of a larger Palestinian delegation, would delay going to Cairo for several days. The talks were to be led by the Egyptians, because the U.S. and Israel won't sit at the table with Hamas representatives.
—William Mauldin and Asa Fitch contributed to this article.
Write to Nicholas Casey at nicholas.casey@wsj.com
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