Hamas to release American hostage in Gaza, Israel calls it 'psychological warfare'

Hamas said on Friday it had agreed to free an American-Israeli dual national if Israel begins a phase of ceasefire talks towards a permanent end to the war, but Israel dismissed the offer as "psychological warfare".

Hamas said it had made the offer to release New Jersey native Edan Alexander, a 21-year-old soldier in the Israeli army, and hand over bodies of four other dual national hostages, after receiving a proposal from mediators for negotiations on the stalled second phase of a ceasefire deal.

Fighting in Gaza has been halted since January 19 under the ceasefire accord. But when its preliminary first phase expired on March 2, the sides failed to agree the start of the second phase, leading to a breakdown of talks and a total Israeli blockade of the Gaza Strip.

Israel has offered to extend the first phase into April, a proposal backed by US envoy Steve Witkoff. But Hamas has said it would resume releasing hostages only if the second phase begins, during which Israel would be required to discuss troop withdrawals and a permanent end to the war, major demands of Hamas.

Netanyhu's office called Hamas' offer to release Alexander "manipulation and psychological warfare".

"While Israel has accepted the Witkoff proposal, Hamas stands by its refusal and has not budged a millimeter," his office added. It said he would convene with his cabinet on Saturday night to discuss the hostage situation and decide on the next steps.

US envoy Witkoff told reporters at the White House early in March that gaining the release of Alexander was a "top priority". US hostage negotiator Adam Boehler met with Hamas leaders in recent days to seek Alexander's release.

Two Hamas officials told Reuters their agreement to release the American-Israeli hostage and the four bodies was conditional on beginning the talks on the second phase of the ceasefire, opening crossings, and lifting the total blockade imposed by Israel two weeks ago.

"We are working with mediators for the agreement to succeed and to compel the occupation to conclude all phases of the agreement," Abdel-Latif Al-Qanoua, the Hamas spokesperson, told Reuters.

"Hamas' approval to release Edan Alexander aims to push towards the conclusion of the phases of the agreement," said Qanoua.

Israel blocked the entry of all supplies trucks into Gaza on March 2 as the standoff escalated, with Hamas calling on Egyptian and Qatari mediators to intervene.

The United States, Qatar and Egypt have been trying to bridge the differences between Hamas and Israel to restart negotiations for the second phase in order to release remaining hostages held in Gaza and lift the blockade.

Hamas carried out a cross-border raid into southern Israel on October 7, 2023, killing 1,200 people and capturing 251 hostages, according to Israeli tallies.

Israel's assault on the Gaza Strip since then has killed more than 48,000 Palestinians, according to Gaza health officials, and reduced much of the territory to rubble.