Tel Aviv  - A bomb planted by Palestinian militants killed an Israeli soldier Tuesday morning along the Gaza Strip border, sparking Israeli retaliation that killed two Palestinians in the most serious violence since the start of a Gaza ceasefire on January 18.

Israel closed the crossing points into the Gaza Strip "until further notice," an Israeli official said.

Early Wednesday, Israeli forces struck an alleged tunnel complex in southern Gaza near the Rafah crossing into Egypt, Arab media reported citing witnesses.

The latest incidents came as Egyptian Foreign Minister Ahmed Aboul Gheit said he expected agreement next week on a long-term truce between Israel and Hamas, the Islamist militant movement that controls the Gaza Strip.

It was unclear whether the bombing and subsequent airstrikes would launch a new cycle of violence, which could scuttle efforts to strike a lasting ceasefire to replace the six-month truce that expired on December 19.

The expiration of that uneasy ceasefire was followed by a barrage of rockets fired by Hamas militants toward southern Israel, bringing a massive Israeli bombing campaign on December 27 and a ground operation a week later. Operation Cast Lead stretched for three weeks before Israel and Hamas accepted a new ceasefire.

"Egyptian efforts towards a truce indicate that we can reach a lasting ceasefire in the first week of February," Aboul Gheit told reporters in Cairo.

He said that Egypt would then strive for reconciliation between Hamas and Fatah, the feuding Palestinian political factions.

"If we can reach agreements during the last week of February, this will pave the way for the reconstruction of Gaza," he said, following a meeting with EU foreign-policy chief Javier Solana and Egyptian President Hosny Mubarak in Cairo.

"Then the peace process can be put back on track in cooperation with the US envoy to the Middle East, George Mitchell."

Arab media have reported that Hamas is demanding that any long- term truce will see the crossing points into the Gaza Strip opened continuously. Israel is only willing to partially open the crossings, which is conditions on the release of Gilad Shalit, an Israeli soldier snatched in a cross-border raid from Gaza on June 25, 2006.

Hamas further wants its operatives to be stationed at the Rafah border crossing, along with European observers and officials from the West Bank-based Palestinian Authority (PA).

The crossing has been closed since Hamas seized control of Gaza security installations in June 2007. Egypt has previously said that the crossing will only be opened with PA officials and EU observers, as laid down in a US-brokered, November 2005 agreement, which Hamas did not recognize.

As part of the truce, Israel also wants Hamas to stop smuggling arms into Gaza, a condition that the Islamist movement has rejected.

An Israeli military spokesman in Tel Aviv said that Tuesday's blast occurred as troops were patrolling the Israeli side of the Gaza border fence. In addition to the non-commissioned officer killed, one officer was seriously wounded and two soldiers suffered minor injuries.

Israel almost immediately shelled Palestinian structures near the Kissufum crossing, east of Gaza City, where the blast took place, killing a Palestinian farmer.

An Israeli airstrike in the mid-afternoon killed a Hamas militant riding a motorcycle, Palestinians said.

No militant group claimed responsibility for the blast, which came nine days after Israel, and then the Palestinian militias, instituted separate ceasefires to bring the Gaza Strip fighting to an end.

Israeli caretaker Prime Minister Ehud Olmert said late Tuesday that Tuesday's military response after the bomb blast at the border was not the last action Israel would take in reaction to the incident.

He pointed out that Israel still considers its ceasefire unilateral, not a mutual ceasefire agree with Hamas, and reserves the right to take military action when necessary. (dpa)