The Islamic Jihad militant group has said Egypt has brokered a ceasefire aimed at ending a two-day flare-up between Israel and militants in the Gaza Strip

Islamic Jihad leader Khaled al-Batsh said the militant group launched rockets into Israel on Wednesday after Israeli soldiers killed three of their fighters a day earlier.

The Israeli military carried out air strikes and fired tank shells at militant targets in the Gaza Strip on Wednesday, the heaviest onslaught in nearly two years.

A Palestinian official said Egypt made contact with both sides to restore calm. There was no immediate word from Israel, but a senior Defence Ministry official said he expected the fighting to die down soon.

Meanwhile British Prime Minister David Cameron is in the region for talks with Palestinian President Mahmoud Abbas and Israeli Prime Minister Benjamin Netanyahu.

Cameron wants to encourage the leaders to back a framework for a peace deal being mapped out by US Secretary of State John Kerry.