US Secretary of State Antony Blinken said on Thursday a major military operation by Israel in Gaza's southernmost city of Rafah would be "a mistake," adding that a truce agreement was "possible."

Blinken said "gaps are narrowing" in ongoing ceasefire and hostage release talks in Qatar, where the head of Israel's spy agency was due to meet his American and Egyptian counterparts on Friday.

"It's difficult to get there, but I believe it is still possible," Blinken said in a joint press conference with his Egyptian counterpart in Cairo.

Blinken also said there is "a better way to deal with the ongoing threat posed by Hamas" than Israel's plans for a major military operation in Rafah.

Global concern has surged over a looming Israeli ground offensive on Rafah, where 1.5 million mostly displaced Palestinians are sheltering, hemmed in by the Egyptian border.

He said the ground offensive would be "unnecessary" and that "there is no place for the civilians amassed in Rafah to get out of harm's way."

"There is a false choice involved here ... Hamas can be effectively dealt with without a major ground operation in Rafah," Blinken continued.

Egyptian Foreign Minister Sameh Shoukry echoed the call for a "ceasefire and release of hostages and detainees" and an urgent "intensifying of aid operations in light of an unprecedented situation."

The United Nations has repeatedly warned of imminent famine facing 2.4 million people in the besieged Palestinian territory, where over five months of war have largely destroyed civilian infrastructure and left most of the population displaced.

The bloodiest ever Gaza war broke out on October 7 after Hamas launched an unprecedented attack on Israel, resulting in about 1,160 deaths, according to a tally of official figures.

Militants also seized about 250 hostages, of whom Israel believes 130 remain in Gaza, including 33 who are presumed dead.

Israel's retaliatory military campaign in Hamas-ruled Gaza has killed nearly 32,000 people, mostly women and children, according to the territory's health ministry.

"Israel must not carry out any military operation in Rafah, to avoid even more civilian victims and displacement," Shoukry said, reiterating Cairo's previous warnings against the forced displacement of Palestinians.

Blinken and Shoukry had earlier on Thursday held meetings with government ministers from Qatar, Saudi Arabia, Jordan and the United Arab Emirates, as well as a representative of the Palestinian Authority, which governs the occupied West Bank.

In a joint statement, the Arab ministers called for "a comprehensive and immediate ceasefire" and the "opening of all crossings between Israel and the Gaza Strip."

Blinken also confirmed the United States had circulated a draft UN resolution calling for an "immediate" ceasefire in Gaza, after months of Security Council vetoes objecting to the phrasing.

The resolution stressed "the need for an immediate and durable ceasefire" to protect civilians and allow aid into the territory.

Blinken stressed any immediate truce must be linked to the release of hostages taken by Palestinian militants during the October 7 attack. (AFP)