Live: Hamas agrees to release 10 Israeli captives

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Here are the day's key developments:

- Hamas announced that it has agreed to release 10 Israeli captives towards reaching a ceasefire in Gaza, even if the talks were "tough" due to Israel's "intransigence". 

- The Israeli army confirmed that one of its soldiers, who was operating an excavator in southern Gaza, was killed by Hamas fighters.

- Responding to a report from Axios on Wednesday that there were "secret talks" between the US, Israel, and Qatar at the White House which may lead to a breakthrough in Gaza ceasefire talks, Trump told reporters that they are "very close" to an agreement. 

- US Secretary of State Marco Rubio announced that he is levying sanctions on UN Human Rights Council special rapporteur Francesca Albanese "for her illegitimate and shameful efforts" in supporting accountability for Israel and the US at the International Criminal Court.

- It has been revealed that the US Agency for International Development (USAID) in June wrote a confidential internal assessment, criticising a request for funding submitted by the controversial Gaza Humanitarian Fund (GHF). The Trump administration later approved $30m in funding for the organisation.

- Fuel shortages in Gaza could cut 44,000 children off from clean water supplies within days, Save the Children has warned.

The Israeli army confirmed late on Wednesday that one of its soldiers, who was operating an excavator in southern Gaza, was killed by Hamas fighters.

The ambush took place east of Khan Younis, according to a statement issued by Hamas.

The Israeli army described it initially as an attempted abduction before a struggle ensued, and Hamas fighters shot the soldier. He was identified as 25-year-old Master Sgt. Abraham Azulay, a heavy engineering operator in the Southern Command. 

Israeli air strikes on Nuseirat in central Gaza and on al-Mawasi in the south late on Wednesday evening, local time, have caused several injuries, local reports said on Wednesday.

With Israeli Prime Minister Benjamin Netanyahu still in Washington on a nearly week-long visit, and with ceasefire talks possibly arriving at a breakthrough, Israel has stepped up its nighttime bombings, leaving almost 100 Palestinians dead every day in the strip.

The main US government agency that distributes foreign aid raised “critical concerns” about a newly formed aid group’s ability to deliver food safely and effectively to Palestinians in Gaza, just days before the Trump administration announced $30m in funding for the organisation, CNN reported on Tuesday.

The US Agency for International Development (USAID) in June wrote a 14-page confidential internal assessment, criticising a request for funding submitted by the controversial Gaza Humanitarian Fund (GHF). 

Read more: At least nine elements normally required to obtain government funding were not included in the application

Hamas announced on Wednesday that it has agreed to release 10 Israeli captives towards reaching a ceasefire in Gaza, even if the talks were "tough" due to Israel's "intransigence". 

The group added that there are multiple sticking points, including access to humanitarian aid, the withdrawal of Israeli forces, and "genuine guarantees for a permanent ceasefire".

- with reporting from Reuters

Responding to a report from Axios on Wednesday that there were "secret talks" between the US, Israel, and Qatar at the White House which may lead to a breakthrough in Gaza ceasefire talks, Trump told reporters that they are "very close" to an agreement. 

Axios said the discussions, which took place on Tuesday, "honed in on the key remaining sticking point" that special envoy for Peace Missions Steve Witkoff had referenced in earlier comments. He said three out of four issues had been resolved. 

The remaining issue, according to Axios' sources, is to determine which lines the Israeli forces would withdraw to during a ceasefire in Gaza. 

"Both sources said Witkoff and the Qatari official made it clear to [Israeli Minister of Strategic Affairs Ron] Dermer that the map proposed by Israel - which involves a far more narrow redeployment than the one the IDF carried out during the previous ceasefire - is a non-starter," Axios reported. 

US Secretary of State Marco Rubio on Wednesday announced that he is levying sanctions on UN Human Rights Council special rapporteur Francesca Albanese "for her illegitimate and shameful efforts to prompt @IntlCrimCourt action against US and Israeli officials, companies, and executives".

Rubio made the announcement on X.

"Albanese’s campaign of political and economic warfare against the United States and Israel will no longer be tolerated. We will always stand by our partners in their right to self-defense," he wrote.

"The United States will continue to take whatever actions we deem necessary to respond to lawfare and protect our sovereignty and that of our allies."

Albanese had previously been labelled an "antisemite" by the Trump administration. Her latest report named several US companies for aiding Israel's "economy of genocide". 

Yemen's Ansar Allah group claimed responsibility for an attack earlier this week that sank a merchant vessel - the second ship to be hit in less than 24 hours.

"The naval force of the Yemeni Armed Forces targeted the ship (Eternity C)," Houthi military spokesman Yahya Saree said, claiming solidarity with Palestinians in Gaza and saying the vessel was headed towards Eilat in Israel.

Rescuers pulled six crew members alive from the Red Sea on Wednesday and were searching for 15 still missing from the second of two freighters sunk in as many days by the Yemeni group, Reuters reported.

Four of the 25 people aboard the Eternity C cargo ship were killed before the rest of the crew abandoned the vessel, which sank on Wednesday morning after being attacked on Monday and Tuesday, sources at security companies involved in a rescue operation told Reuters.

Reporting by AFP and Reuters

Fuel shortages in Gaza could cut 44,000 children off from clean water supplies within days, Save the Children has warned.

The charity said that it relies on fuel to transport clean water daily to over 50 communities across Gaza, including some 44,072 children. Dwindling fuel supplies mean the operation is at risk of grinding to a halt.

"Access to safe water is a fundamental human right, critical not just for drinking but for staving off disease that is rife across Gaza, where nearly everyone now lives in crowded shelters and tents, having been displaced multiple times," the charity said in a statement.

It added that 39 percent of people in the strip seeking medical consultations are suffering from acute diarrhoea – one of the world’s biggest killers of children.

The Israeli army says it has expanded its ground offensive on northern Gaza's Beit Hanoun after five Israeli soldeirs were killed in an ambush in the area.

In a statement on Telegram, the military said that troops are working to “dismantle terrorist infrastructure and Hamas military capabilities in the area”.

Al Jazeera reported that heavy Israeli artillery shelling has been heard in Beit Hanoun since the announcement.

Haaretz has reported that Israeli Prime Minister Benjamin Netanyahu supports a plan to confine Palestinians from the Gaza Strip to a so-called "humanitarian city" in Rafah, a plan critics have compared to a concentration camp. 

Under the proposal, hundreds of thousands of Palestinians would be admitted into the camp after undergoing security screening. Once inside, they would be offered food and healthcare, but would not be permitted to leave. 

"Give them Ben & Jerry's, for all I care," Netanyahu has said, a source told Haaretz. 

According to the Israeli daily, Netanyahu does not rule out the possibility of Israel running the site in the short term. 

Another senior political official said that a governing system in Gaza "will be responsible for life there" but that "maybe for the time being, it will be us".

Read more: Netanyahu backs Gaza 'concentration camp' plan, says 'feed them Ben & Jerry’s’

An Israeli strike targeting a residential apartment in western Gaza City has killed three people, including an infant, Wafa news agency reported on Wednesday.

According to Gaza's civil defence agency, eastern Gaza City's al-Tuffah neighbourhood has been pummelled by over 20 air strikes.

The death toll of Palestinians killed in Israeli attacks in Gaza since dawn has risen to 39 people, Al Jazeera Arabic is reporting, citing medical sources.

Of that figure, 19 people were killed in attacks in northern Gaza, while eight were aid seekers shot by Israeli forces near an aid distribution point north of Rafah.

Israeli fighter jets have launched a major attack on the eastern part of Gaza City.

Al Jazeera journalist Hani Mahmoud reported that planes are "carpet bombing" the city, in what he said seems to be a "targeted killing by Israel".

"We heard multiple explosions, massive ones, we had to duck and take cover. We could feel the building we’re in shaking," he said, adding that "the entire street was hit by these bombs".

The mortality rate among Palestinian children under five in Gaza has risen tenfold since the onset of Israel's war on Gaza in October 2023, a survey by the NGO Doctors Without Borders (MSF) has revealed.

The retrospective survey of  2,523 MSF staff and their family members in Gaza also showed that the mortality rate for babies under a month old was six times higher compared with Palestinian Ministry of Health estimates before the outbreak of the war.

"The children of Gaza are being decimated," Amande Bazerolle, deputy manager of MSF's emergency department, said.