Israeli jets pound militant targets in Gaza, as rockets rain on southern Israel

Israeli jets pounded militant targets in Gaza early Saturday as rockets rained on southern Israel, hours after a wave of Israeli airstrikes on the coastal enclave killed at least 12 people, including a senior militant and a five-year-old girl.

The fighting began Friday with Israel's targeted killing of a senior commander of the Palestinian Islamic Jihad and continued throughout the night, drawing the sides closer to an all-out war.

But the territory's Hamas rulers appeared to stay on the sidelines of the conflict for now. Israel and Hamas have fought four wars and several smaller battles over the last 15 years at a staggering cost to the territory's two million Palestinian residents.

The latest round of Israel-Gaza violence was sparked by the arrest this week of a senior Islamic Jihad leader in the West Bank, part of a month-long Israeli military operation in the territory. Citing a security threat, Israel then sealed roads around the Gaza Strip and on Friday killed the militant leader in a targeted strike.

A blast was heard in Gaza City, where smoke poured from the seventh floor of a tall building. Video released by Israel's military showed the strikes blowing up three guard towers with suspected militants in them.

Shortly before noon Saturday, Israeli warplanes stepped up airstrikes. After warning residents in phone calls, fighter jets dropped two bombs on the house of an Islamic Jihad member in a residential area of Gaza City, flattening the two-storey structure and badly damaging surrounding homes. Women and children rushed out of the area, and there were no casualties.

Another airstrike hit an Islamic Jihad site nearby on Saturday. Gaza militants continued to launch rounds of rockets into southern Israel around every half hour, though there were no reports of casualties.

The lone power plant in Gaza ground to a halt at noon Saturday for lack of fuel as Israel has kept its crossing points into Gaza closed since Tuesday. With the new disruption, Gazans can get only 4 hours of electricity a day, increasing their reliance on private generators.

In a nationally televised speech Friday, Israeli Prime Minister Yair Lapid said his country launched the attacks based on "concrete threats."

"This government has a zero-tolerance policy for any attempted attacks — of any kind — from Gaza toward Israeli territory," Lapid said. "Israel will not sit idly by when there are those who are trying to harm its civilians."

"Israel isn't interested in a broader conflict in Gaza but will not shy away from one either." he added.

The violence poses an early test for Lapid, who assumed the role of caretaker prime minister ahead of elections in November, when he hopes to keep the position.

Lapid, a centrist former TV host and author, has experience in diplomacy having served as foreign minister in the outgoing government, but has thin security credentials. A conflict with Gaza could burnish his standing and give him a boost as he faces off against former prime minister Benjamin Netanyahu, who led the country during three of its four wars with Hamas.

Hamas also faces a dilemma in deciding whether to join a new battle barely a year after the last war caused widespread devastation. There has been almost no reconstruction since then, and the isolated coastal territory is mired in poverty, with unemployment hovering around 50 per cent.