Prime Minister Benjamin Netanyahu said on Thursday Israelinfo-icon is prepared for a widespread military campaign in Gazainfo-icon as tensions simmered following the latest flare-up -- but only after all other options were exhausted.

Netanyahu has been seeking to head off political pressure over Gaza ahead of April 9 electionsinfo-icon, in which he faces a strong challenge from former military chief Benny Gantz.

"In recent days I gave instructions to fortify forces, to add vehicles, to be prepared for a comprehensive campaign," he said during the inauguration of a new road in northern Israel.

The premier, who was speaking after visiting military forces on the Gaza border, noted however that a warinfo-icon would be the last option.

"All Israelis should know that if a comprehensive campaign is required, we will enter it strong and safe, after we have exhausted all other possibilities," said Netanyahu, who also serves as defence minister.

Palestinian militants had on Monday fired a long-distance rocket from the Gaza Strip, hitting a house north of Tel Aviv and wounding seven Israelis, triggering Israeli air strikes and further Palestinian fire at southern Israel.

Netanyahu beefed up the military presence near Gaza, but by Wednesday the fighting had abated after Hamas announced a ceasefire brokered by Egyptinfo-icon.

Israel has been carefully monitoring the situation on the Gaza border ahead of Saturday, which will mark a year since mass protests and deadly clashes began there.

A demonstration on the day of the anniversary is expected to draw thousands of Palestinians.

A Hamas official said an Egyptian delegation met with the movement's leader Ismail Haniya in Gaza City on Wednesday night in further efforts to calm tensions.

The official said the delegation informed Hamas and its allies in Gaza that Israel had agreed to measures such as improving the electricity supply in the strip, which suffers from severe power shortages.

In exchange, Hamas would be expected to maintain calm at the weekly protests along the Gaza border, including during Saturday's anniversary.

It was unclear whether any progress had been made, and an Egyptian official said they would continue to mediate between the sides to try and maintain calm.