Hamas has presented a Gaza ceasefire proposal to mediators and the U.S. which includes the release of Israeli hostages in exchange for freedom for Palestinian prisoners, 100 of whom are serving life sentences, according to a proposal seen by Reuters.

Hamas said the initial release of Israelis would include women, children, elderly, and ill hostages in exchange for the release of 700-1000 Palestinian prisoners, according to the proposal. The release of Israeli "female recruits" is included.

Israeli Prime Minister Benjamin Netanyahu's office said on Thursday a new Gaza truce proposal presented by Hamas to mediators was still based on "unrealistic demands."

His office said an update on the issue will be presented to the war cabinet and extended security cabinet on Friday.

Egypt and Qatar have been trying to narrow differences between Israel and Hamas over what a ceasefire should look like as a deepening humanitarian crisis has one quarter of the population in the battered Gaza Strip facing famine.

Hamas said ceasefire negotiations had faltered over the past few weeks due to Netanyahu’s rejection of its demands, which include a permanent ceasefire, Israeli withdrawal from the strip, the return of the displaced in the south of the enclave to the centre and the north, and stepping up aid without restrictions.

In February, Hamas received a draft proposal from Gaza truce talks in Paris which included a 40-day pause in all military operations and the exchange of Palestinian prisoners for Israeli hostages at a ratio of 10 to one - a similar ratio to the new ceasefire proposal.