GAZA CITY, Gaza (AFP) – Palestinian militants holding an Israeli soldier captive issued an ultimatum Monday for Israel to free prisoners or face the consequences as the army kept up its military assault on the Gaza Strip.

The deadline was immediately rejected by Israel, which vowed to keep up its military incursion in Gaza after a sixth straight night of air attacks launched in a bid to pressure the Palestinians into giving up the serviceman.

“Faced with the Zionist enemy’s persistence in taking military measures and aggressions, we give it a delay expiring Tuesday, July 4 at 6:00 am (0300 GMT),” warned the three groups that seized the conscript in an attack on an army post eight days ago.

“If the enemy does not meet the demands we laid out in our previous statement… we will consider the matter closed and the enemy will be responsible for all results,” said a statement from the Popular Resistance Committees, the armed wing of the ruling Hamas movement and the Army of Islam.

Israel, which has massed 5,000 troops on the Gaza border, swiftly rejected the ultimatum and militant demands for the release of 1,000 prisoners as well as Palestinian women and minors held in Israel.

“We will not conduct any negotiations on the release of prisoners,” Olmert’s office said, holding the Palestinian Authority responsible for the safety of 19-year-old corporal Gilad Shalit.

“Israel will not give in to extortion by the Palestinian Authority and the Hamas government, which are led by murderous terrorist organisations.”

Olmert also gave the green light to keep up military operations, after consulting late Monday with defence officials.