"There is no doubt that we heard gunfire on the Palestinian side as well as on the Egyptian side."
'Exchange of gunfire'
He said the situation had calmed considerably shortly thereafter.
"Senior officials from Palestinian security forces have arrived at the border [and] they have calmed the situation down. They were able to push back the thousand or so protesters and rock-throwers who had gathered here.
"About an hour ago, a rally that had been organised by Hamas to criticise Egypt's denial to allow the Viva Palestina convoy to make its way into Gaza with much needed aid was held here.
"Shortly after that concluded, Palestinians started throwing rocks at Egyptian security personnel on the other side of the border and we heard an exchange of gunfire."
Osama Hamdan, a Hamas official in Beirut, said he regret the casualties, but he raised doubts about who carried out the shootings.
"According to eyewitnesses, it was a peaceful rally and the shooting started from the Egyptian side while one of Hamas' leaders was addressing the rally.
"Anyway, we are sorry. We believe that the relations between Palestinians and Egyptians must be at its best level."
Aid convoy delayed
Gaza's Hamas leaders had called for the rally to protest the delay of the Viva Palestina international aid convoy at Egypt's port city of al-Arish.
Wednesday's fighting followed a clash late on Tuesday between Egyptian authorities and international members of the Viva Palestina convoy, which is destined for the Gaza Strip.
The protests were sparked by an Egyptian decision to allow 139 vehicles to enter Gaza through the Rafah crossing, about 45km from the port in al-Arish, but requiring a remaining 59 vehicles to pass via Israel.
The convoy, led by George Galloway, a British MP, had already been delayed by more than a week, after he and a delegation of Turkish MPs failed to persuade the Egyptians to change their mind.
Fawzi Barhoum, a Hamas spokesman, criticised Egyptian authorities on Wednesday for "reinforcing the seige on Gaza".
"Around 40 Arab, Islamic and European states have mobilized financial and media support to lift the siege imposed on Gaza Strip," he told Al Jazeera.
|The convoy arrived in al-Arish after a dispute with Cairo on the route [REUTERS]
"Why does not Egypt go along this path of solidarity with Gaza Strip? Such practices are outrageous, inhumane and unethical.
"Our expectations from Egypt and its security authorities are high, but it seems that these expectations are being smashed by batons, hot water and the brutal beating of hundreds of supporters in al-Arish port ...".
But in Egypt, Mohamed Abdellah, an official in the country's ruling National Democratic Party, said Egypt would not be "ordered around" by anyone.
"Egypt cannot be slapped around by everybody. It is true we have a historical responsibility (towards the Palestinians) which we can never abandon.
"However if anybody believes that Egypt's arm can be twisted, we say to him you are mistaken; you are mistaken, you are mistaken."
The convoy of nearly 200 vehicles arrived in al-Arish on Monday after a dispute with Cairo on the route.
But the arrival came after a bitter dispute between its organisers and the government, which banned the convoy from entering Egypt's Sinai from Jordan by ferry, forcing it to drive north to the Syrian port of Lattakia.
The convoy with 210 lorries full of medicine and other supplies set out from the UK nearly a month ago.
Israel and Egypt have severely restricted travel to and from the Gaza Strip since Hamas seized power there in June 2007, after winning Palestinian legislative elections in 2006.
The blockade currrently allows only very basic supplies into Gaza.
The siege has severely restricted essential supplies and placed Gazans in a dire situation, made worse by Israel's military assault last winter that reduced much of the territory to ruins.