Prospects for a Gaza ceasefire dim even as US keeps hope

By Trevor Hunnicutt, Matt Spetalnick and Humeyra Pamuk

WASHINGTON (Reuters) - U.S. officials have not given up hope of landing a Gaza ceasefire and hostage deal but are increasingly pessimistic that a breakthrough can come anytime soon, according to sources and officials familiar with the matter.

The Wall Street Journal on Thursday reported that senior U.S. officials were now privately acknowledging that an agreement may not be within reach before President Joe Biden's term ends in January.

While noting the dim prospects, several U.S. officials said this was not an administration-wide assessment.

"I do not rule it out," said one of the U.S. officials when asked whether a deal can be struck before the end of Biden's term, adding the administration continues to work on bridging the remaining gaps.

"Doesn't mean it will get done," the official added, speaking on condition of anonymity.

Since August, senior U.S. officials including Secretary of State Antony Blinken have raised expectations for a truce, saying a deal was 90% agreed and they were working to iron out the few but challenging disagreements.

But shifting demands from both Israel and Hamas have repeatedly spiked efforts to reach a deal to end the nearly year-long bloodshed and have been a source of deep frustration for Biden administration officials, one of the sources familiar with the thinking said.

The odds of a quick resolution appeared even smaller after an unprecedented attack on Hezbollah this week in which pagers and radios used by its members exploded, killing 37 people and wounding thousands.

On Friday, Israel killed a top commander with the Iran-aligned Lebanon-based armed group Hezbollah in an airstrike on Beirut's southern suburbs.

"We don't appear to be particularly close at the moment," a senior administration official said.

As the negotiators tried to hammer out an agreement, doubts remained over whether Israel and Hamas were committed to clinching a deal. Israeli Prime Minister Benjamin Netanyahu added new demands for the proposal in July, while Hamas did the same over the prisoners it wants released.

"The war evolved in many different ways, and conditions on the ground changed in many different ways, and the outlooks and the perspectives of the two sides changed as the conflict and the violence wore on," White House national security spokesperson John Kirby told reporters on Friday.

"All of that context affects the decision-making process of leaders involved," Kirby said.

The U.S. wants Israel and Hamas to engage with greater urgency before the parallel conflict between Israel and Hezbollah escalates further, sucking up more of the diplomatic oxygen in the region, one of the sources said.

This week's attack on Hezbollah members was widely believed to have been carried out by Israel, which has neither confirmed or denied its involvement.

Disagreement over the status of a narrow stretch of land known as the Philadelphi corridor on Gaza's border with Egypt has been one of two key points of contention throughout August. Despite some progress the issue remains unresolved.

More recently, the numbers and types of prisoners to be exchanged has emerged as the key issue and has led to an impasse, sources and officials said.

Still, Biden said he was not giving up, when asked whether an agreement remained realistic.

"If I ever said it was not realistic, I might as well leave. A lot of things don't look realistic until you get it done. We have to keep at it," Biden told reporters.

Hamas militants attacked southern Israel on Oct. 7, 2023, and killed 1,200 people, according to Israeli tallies, while abducting 250 others, triggering the latest round of fighting in the decades-old Israeli-Palestinian conflict.

In response, Israel launched a relentless military offensive on Gaza that killed more than 40,000 people, according to Palestinian officials, and reduced the tiny enclave to a wasteland.

(Additional reporting by Andrea Shalal and Jonathan Landay; Writing by Humeyra Pamuk; Editing by Don Durfee and Daniel Wallis)