Israeli artillery fire in the southern Gaza Strip has killed four Palestinian fighters and wounded others, officials from both sides said.

The local commanders of Hamas' military wing were killed by tank fire, Palestinian officials said on Friday, while the Israeli army said five of its soldiers were wounded by an explosive device.

The Israeli military said in a statement its aircraft targeted a tunnel used by Palestinian fighters to carry out
attacks on Israelis and accused Hamas of breaching a ceasefire reached a year ago, after an eight-day cross-border war.

Palestinian officials said Rabieh Barikeh was killed instantly in the firefight late Thursday night and Khaled Abu Bakr died of his wounds during the night.

The bodies of Mohammed al-Qassas and Mohammed Daoud were discovered later.

The officials said all were local commanders of Hamas's Ezzedine al-Qassam military wing.

The Reuters news agency reported that Israeli tanks had entered Gaza, remaining there for several hours before clashes erupted, during the attack.

Witnesses told Al Jazeera that the Israeli artillery was aimed at farmers' houses, while Hamas said that an Israeli helicopter also fired rockets in the area.

An Israeli military spokeswoman said forces were carrying out "a pinpoint action" in the area to search for a tunnel connecting Gaza to Israel, but did not have further details.

Suing over settlements

Meanwhile, Palestinian Foreign Minister Riyad al-Malki on Thursday denounced Israeli plans to build hundreds of new settler homes in Jerusalem, threatening to pursue international legal action in response.

Israel announced on Wednesday it would build 1,500 new settler homes in the mostly Arab sector of Jerusalem, immediately after releasing 26 Palestinian prisoners in line with its commitments to US-backed peace talks.

"The foreign ministry is seriously looking at turning immediately to international courts and organisations, and filing the necessary complaints in order to stop settlement building," Malki said.

He condemned "plans approved by Prime Minister Benjamin Netanyahu for settlement building, and Netanyahu's attempts to link the settlement issue with the prisoners issue".

PLO chiefs convened later on Thursday in Ramallah, in a session chaired by President Mahmoud Abbas.

"The Palestinian leadership will take a number of steps in the next few days to face the settlement offensive," the Palestine Liberation Organisation's executive said after the meeting.

A senior Palestinian official denied reports that Palestinian negotiators would resign in protest at the latest Israeli move.

Israel says it never promised to freeze settlement during talks.

The Palestinians agreed to refrain from pursuing legal action against Israel during ongoing peace talks, but have repeatedly warned that continued settlement building would force them to recourse to the International Criminal Court and other international bodies.

Source: Al Jazeera and agencies