An Israeli government minister has warned that Israel may move to re-occupy the Gaza Strip.
Finance Minister Yuval Steinitz says Israel will not allow Hamas, which governs the territory, to arm itself with long-range missiles, the BBC reports.
Two Israeli soldiers and two Palestinian militants were killed on Friday in the most deadly clash on the Israel-Gaza frontier since Israel ended an offensive there 14 months ago.
Meanwhile, Israel's Prime Minister Benjamin Netanyahu has moved to ease tensions with the United States, describing the two countries' relations as those of allies and friends.
Mr Netanyahu also dismissed reports one of his confidants had called the US President Barack Obama a disaster for Israel.