Hamas has aired a video purporting to show the dead bodies of two Israeli hostages it was holding in Gaza.
The bodies of Yossi Sharabi, 53, and Itay Svirsky, 38, are reportedly shown in the footage, which is narrated by a third hostage, 26-year-old Noa Argamani.
Ms Argamani was heard saying the two others were killed “by our own IDF strikes”, referring to the Israeli military.
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But the Israel Defence Forces (IDF) spokesman Daniel Hagari accused Hamas of lying.
He said: “Itay was not exposed to fire from our forces – this is a lie. The building they were in was not targeted, nor was it bombed by our forces.
“We did not know in real time the whereabouts of the kidnappers. We do not target any place where we know there may be kidnappers.
“We have already bombed targets close to where they were detained, and we are currently investigating the incident and its circumstances and examining the photos published by Hamas along with other information we have.”
It comes a day after all three hostages were shown alive in Gaza in another video released by Hamas, which urged the Israeli government to halt its aerial and underground offensive and bring about their release.
The undated 37-second video of Mr Sharabi, Mr Svirsky, and Ms Argamani, ended with the caption: “Tomorrow (Monday), we will inform you of their fate.”
Then, on Monday, Hamas released a follow-up video to Sunday’s one featuring the faces of the trio and offering three options: all three are killed, “some are killed, some are injured”, or all three are spared.
It ended with the message: “Tonight we will inform you of their fate.”
Israel‘s defence minister Yoav Gallant responded to the third video, accusing the Palestinian militant group of carrying out “psychological abuse” against Israeli families at a time when it is suffering heavy battlefield casualties.
He also said that unless military pressure was kept up, Hamas would not agree to release any more captives.
Mr Gallant claimed the IDF operation in southern Gaza was nearing its end.
Earlier this month, Israel said its troops had finished dismantling Hamas’s “military framework” in the north of the Gaza Strip.
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On Monday, Mr Gallant also said the end of the war must be accompanied by diplomacy, adding that leadership in the Strip should then be left to the Palestinians.
Israeli forces have continued bombarding targets across the enclave and clashing with the militants in southern and central areas.
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Mr Sharabi, Mr Svirsky, and Ms Argamani were among 240 people taken hostage by Hamas during a surprise cross-border rampage into southern Israel on 7 October. Around 1,200 people were killed in the massacre.
Around half of the 240 captives were released during a week-long truce last November.
But Israel says 132 remain in Gaza and 25 have died in captivity.
Palestinian authorities have said more than 24,000 people, including many women and children, have been killed in Israeli retaliatory strikes in Gaza since the Hamas massacre.