Hamas on Friday said it was ready to free an Israeli-American hostage and the remains of four others, after the group and Israel resumed indirect Gaza ceasefire negotiations.

However, Israel said Hamas had "not budged" following a proposal from US President Donald Trump's Middle East envoy Steve Witkoff.

After more than 15 months of war, the first phase of a truce between Hamas and Israel in the Gaza Strip ended on March 1 without agreement on the next steps. A senior Hamas official said on Tuesday fresh talks had begun in Doha, with Israel also sending negotiators.

"Yesterday, a Hamas leadership delegation received a proposal from the brotherly mediators to resume negotiations," Hamas said in a statement Friday.

It said its reply "included its agreement to release the Israeli soldier Edan Alexander, who holds American citizenship, along with the remains of four others holding dual citizenship".

Hamas official Taher al-Nounou said all five are Israeli-Americans.

US Secretary of State Marco Rubio, asked Friday at the G7 group meeting in Canada if Washington was prioritising the release of the American hostage, replied: "We care about all the hostages."

Witkoff was in Qatar this week. According to Israel, he earlier proposed extending the truce's first phase to mid-April.

The extension would see half of the hostages still in Gaza released on the day the deal comes into effect, with the rest freed at the end if agreement is reached on a permanent ceasefire, Israel said.

Hamas has insisted on talks for the second phase of the deal brokered by the US, Qatar and Egypt.

During the truce's initial six-week phase, Hamas released 33 hostages, including eight who were deceased, in exchange for about 1,800 Palestinian detainees held in Israeli prisons.

A source close to Hamas said that "new criteria have been agreed" and include "an increase in the number of detained Palestinians" to be freed.

Despite the first phase's expiry, the ceasefire has largely held.

The Palestinian Red Crescent reported four minors killed in an air strike in northern Gaza on Friday as they gathered wood. Their ages were not given.

Israel halted aid deliveries into Gaza 13 days ago over the truce deadlock. At the weekend, it also cut off the electricity supply, which largely halted output from Gaza's main water desalination plant.

The G7 group on Friday called for the resumption of "unhindered" humanitarian aid for Gaza, marking a possible shift in position by the Trump administration which had not previously criticised Israel for blocking aid.

A joint statement by G7 foreign ministers "reaffirmed their support for the resumption of unhindered humanitarian aid into Gaza and for a permanent ceasefire."

On Thursday, Hamas renewed a demand for Israeli troops to withdraw from south Gaza, accusing Israel of seeking to breach the ceasefire in talks on the next phase of the accord.

Hamas spokesman Hazem Qassem said Israeli forces should have pulled out of the Philadelphi Corridor along the Gaza-Egypt border under the first phase.

Former US president Joe Biden had outlined a second phase involving the release of remaining living hostages, the withdrawal of all Israeli forces left in Gaza and establishment of a lasting ceasefire.

"Meetings are continuing with mediators in Doha. We adhere to what was agreed upon and to entering into the second phase," Qassem said.