Islamic Jihad resumed firing rockets at Israel from Gaza Monday night amid ongoing Israeli air strikes, damaging hopes for an end to a two-day flare-up a week before the Jewish state's election.

The militant Islamist group announced Monday evening it had ceased firing rockets but backtracked about an hour later after Israel continued striking its forces in the Gaza Strip.

"We announced the end of our military response... but the enemy did not commit and struck our base and our fighters," a statement from the group said.

"Therefore we announce that we retaliated in order to affirm the bombardment for bombardment formula."

Islamic Jihad, which is allied to Gaza's Islamist rulers Hamas, has fired some 60 rockets towards Israel since the killing of one of its fighters Sunday morning, according to the United Nations.

Israel's army said many were intercepted by the country's air defence systems and there were no immediate reports of casualties, though one projectile hit an empty playground.

Israeli fighter jets and helicopters responded with strikes on Islamic Jihad bases across the strip, as well as near the capital of neighbouring Syria.

Israeli airstrikes and rocket fire from Gaza were ongoing Monday evening, AFP correspondents in Gaza said.

Prime Minister Benjamin Netanyahu, who is battling for re-election on March 2 in the shadow of an impending corruption trial, had earlier threatened an "extensive campaign" to end the rocket fire.

"Hamas and Islamic Jihad need to understand -- this cannot continue," he said.

Hamas spokesman Fawzy Barhoum responded: "The enemy's threats to expand its aggression, if carried out, will face a resistance never seen before and it should bear the costs and results."

Israel has fought three wars with Hamas, Islamic Jihad and allied groups in Gaza since 2008, most recently in 2014.

Over the past year Hamas and Israel have reached a series of agreements that have seen the Jewish state slightly ease its blockade of Gaza in exchange for relative calm.

Islamic Jihad has not accepted the deals, and Israeli officials warn the group could be seeking to provoke a fresh conflict.

United Nations envoy Nickolay Mladenov called for calm, warning the escalation "risks dragging Gaza into another round of hostilities with no end in sight."

"The indiscriminate launching of rockets against civilian population centres violates international law and must end," he told the UN Security Council.

- Bulldozer -

The flare-up began on Sunday morning when an Islamic Jihad militant was killed along the Gaza-Israel border, apparently while trying to plant an explosive device at the fence.

Israel later confirmed that it removed the militant's body with a bulldozer, with video of the extraction triggering widespread anger.

Islamic Jihad subsequently launched more than 20 rockets and mortars throughout the day.

Israel struck back against targets in both Gaza and Syria.

Air strikes near the Syrian capital Damascus killed two Islamic Jihad fighters and four other Iran-backed militants, according to the Syrian Observatory for Human Rights war monitor.

The militants responded with rocket fire from Gaza, forcing the closure of schools and roads in southern Israel Monday while a number of universities postponed exams.

- Election imminent -

Polls ahead of next week's election show right-wing Netanyahu again running neck-and-neck with centrist rival Benny Gantz ahead of the elections.

The vote is Israel's third in less than a year, after deadlocked polls in April and September 2019.

Both men cancelled planned campaign events Monday evening.

Netanyahu, who has long accused Gantz of relying on Israel's Arab minority for support, seized on comments by the head of the mainly Arab Joint List that it would not support any government that attacked Gaza.

"While the Israeli Defence Forces protect Israeli security Gantz's partner slams them," Netanyahu wrote on Twitter.

Former military general Gantz, who has said the Joint List will not be part of his coalition, accused Netanyahu of playing politics.

"Netanyahu, the country is under fire. Get on helping it," he said in a statement. "The people of the south deserve better."

The fighting is the most intense between Israel and Islamic Jihad since November, when Israeli air strikes killed senior commanders from the group.

The three-day flare-up left 35 Palestinians dead and more than 100 wounded, according to Gaza's Hamas-controlled health ministry.

There were no Israeli fatalities despite hundreds of rockets being fired from the strip.

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