By Humeyra Pamuk, Alexander Cornwell and Pesha Magid
RIYADH (Reuters) -U.S. Secretary of State Antony Blinken on Monday urged Hamas to swiftly accept an Israeli proposal for a truce in the Gaza war and the release of Israeli hostages held by the Palestinian militant group.
Hamas negotiators were expected to meet Qatari and Egyptian mediators in Cairo on Monday to deliver a response to the phased truce proposal which Israel presented at the weekend.
"Hamas has before it a proposal that is extraordinarily, extraordinarily generous on the part of Israel," Blinken said at a meeting of the World Economic Forum in the Saudi capital Riyadh.
"The only thing standing between the people of Gaza and a ceasefire is Hamas. They have to decide and they have to decide quickly," he said. "I'm hopeful that they will make the right decision."
A source briefed on the talks said Israel's proposal entailed a deal for the release of fewer than 40 of the roughly 130 hostages believed to be still held in Gaza in exchange for freeing Palestinians jailed in Israel.
A second phase of a truce would consist of a "period of sustained calm" - Israel's compromise response to a Hamas demand for a permanent ceasefire.
A total of 253 hostages were seized in a Hamas attack on southern Israel on Oct. 7 in which about 1,200 Israelis were also killed, according to Israeli counts.
A French diplomatic source said there was a convergence on the number of hostages released in return for Palestinians held in Israeli prisons, but that obstacles remained on the longer term nature of truce.
"We're not far off from a deal, but that's not the first time," the source said.
Israel retaliated by imposing a total siege on Gaza and mounting an air and ground assault that has killed about 34,500 Palestinians, according to Gaza health authorities.
Palestinians are suffering from severe shortages of food, fuel and medicine in a humanitarian crisis brought on by the offensive that has demolished much of the territory.
Britain's Foreign Secretary David Cameron, who was also in Riyadh for the WEF meeting, also described the Israeli proposal as "generous".
It included a 40-day pause in fighting and the release of potentially thousands of Palestinian prisoners as well as Israeli hostages, he told a WEF audience.
"I hope Hamas do take this deal and frankly, all the pressure in the world and all the eyes in the world should be on them today saying 'take that deal'," Cameron said.
Cameron is among several foreign ministers in Riyadh, including from the U.S., France, Jordan and Egypt, as part of a diplomatic push to bring an end to the Gaza war.
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Blinken reiterated that the U.S., Israel's main diplomatic supporter and weapons supplier, could not back an Israeli ground assault on Rafah if there was no plan to ensure that civilians would not be harmed.
Blinken met with Saudi Crown Prince Mohammed bin Salman on, where they discussed the urgent need to reduce tensions in the region, the U.S. Department of State said in a statement.
More than a million displaced Gaza residents are crammed into Rafah, the enclave's southernmost city, having sought refuge there from Israeli bombardments. Israel says the last Hamas fighters are holed up there and it will open an offensive to root them out soon.
Blinken also said the U.S. and Saudi Arabia had done "intense work together" over the past few months towards a normalisation accord between the kingdom and Israel. That goal has been disrupted by the Gaza war.
"To move forward with normalisation, two things will be required: calm in Gaza and a credible pathway to a Palestinian state," he said.
In return for normalisation, Arab states are pushing for Israel to accept a pathway to Palestinian statehood on land it captured in the 1967 Middle East war - something Israeli Prime Minister Benjamin Netanyahu has repeatedly rejected.
Saudi Arabia's foreign minister, Prince Faisal bin Farhan bin Abdullah also said on Monday that an accord between Washington and Riyadh over normalisation was "very, very close".