The Israeli Minister of Justice Haim Ramon warned Monday of a harsh military response in the Gaza Strip if a captured Israeli soldier is harmed by his Palestinian captors, saying, "If God forbid, they should hurt the soldier, our operations will be far far worse," Ramon said in an interview with Israeli Channel 2 TV.

The threat comes in response to an ultimatum issued by Palestinian resistance that they would cease negotiations if no agreement was reached by 6am Tuesday July 4 – but did not specify what they would do at that time.

The Israeli Prime Minister’s office stated it would not bow down to what it termed "blackmail," and said the Palestinian Authority was being led by "murderous terrorist organizations."

Arabic newspaper Al Halat reported the Israeli soldier, held since last Sunday by three Palestinian resistance groups after a raid on an Israeli military base, was being treated by a Palestinian doctor for "three bullet wounds." The paper cited "informed Palestinian sources" for the information on the soldier.

Israeli authorities said they would agree to release Palestinian prisoners who have not been convicted of hostile terrorist activity if a deal is reached with Hamas. A deal would include the release of the soldier and stability to the Gaza-Israel border again.

The Israeli military said it would not support a deal that would release terrorists "with blood on their hands," but it could agree to release those who have not been involved in planning or carrying out terror attacks. The army would release individuals who are being held under the Prevention of Terrorism Ordinance, such as Hamas ministers and members of the Palestinian Legislative Council, as well as security prisoners jailed for relatively minor offenses such as allegedly belonging to what Israel has termed ‘terrorist organizations’.

The current stand-off, which has continued for a week, was led by military officials who wanted to "boost the ego" of Israeli soldiers who were caught off-guard by a Palestinian ambush in one of their main military camps in southern Gaza a week ago Sunday.  Palestinian resistance fighters managed to infiltrate deep inside the military base using tunnels and other methods, killing two Israeli soldiers and capturing a 19-year old soldier who they have been holding in an unknown location.  Israel has fired thousands of shells by air, sea, and land since the capture, including bombs that destroyed power plants and bridges. The entire Gaza Strip has been in a blackout since Wednesday and five Palestinians have been killed.