Israel's defence minister said on Tuesday that “Gaza is on fire” after heavy strikes overnight targeted Gaza City, with America's top diplomat signalling an intensive operation targeting the Gaza Strip's biggest city may be underway.

The comments by Defence Minister Israel Katz came as US Secretary of State Marco Rubio prepared to travel to Qatar, where he planned to meet with officials there still incensed over Israel's strike last week that killed five Hamas members and a local security official.

While Arab and Muslim nations denounced the strike on Qatar at a summit on Monday, they stopped short of any major action targeting Israel, highlighting the challenge of diplomatically pressuring any change in Israel's conduct in the grinding Israel-Hamas war.

Rubio suggested the offensive had begun, saying: “Well, as you saw, the Israelis have begun to take operations there. So we think we have a very short window of time in which a deal can happen. We don’t have months anymore, and we probably have days and maybe a few weeks so it's a key moment – an important moment.

"Our number one choice is that this ends through a negotiated settlement where Hamas says, 'We're going to demilitarise, we're no longer going to pose a threat.'

"Sometimes when you're dealing with a group of savages like Hamas, that's not possible, but we hope it can happen."

Rubio also said Qatar and the United States are on the verge of finalising an enhanced defence co-operation agreement.

Israeli Prime Minister Benjamin Netanyahu has said he did not did not rule out further strikes on Hamas leaders "wherever they are".

Witnesses said Israel heavily bombarded Gaza City on Tuesday after Rubio backed Netanyahu's new offensive there and its stated goal of eradicating Hamas, saying Israel could "count on our unwavering support" for its military push in the devastated Palestinian territory.

Hours later, the witnesses said there was "heavy, relentless bombing on Gaza City" that levelled homes and left people trapped under the rubble.

One overnight strike hit a house in the western side of Gaza City, killing at least five Palestinians, including two children, according to the Shifa hospital which received the bodies.

Another strike hit at least three houses in the southwestern side of the city, residents said. Medics were searching the rubble for survivors.

Both Netanyahu and Rubio said on Monday the only way to end the conflict in Gaza is through the elimination of Hamas and the release of the remaining 48 hostages – around 20 of them believed to be alive – setting aside calls for an interim ceasefire in favour of an immediate end to the conflict.

Hamas has said it will only free the remaining hostages in return for Palestinian prisoners, a lasting ceasefire and an Israeli withdrawal from Gaza. (Agencies)