International Desk

Hundreds of patients were trapped and thousands of people sought shelter around Gaza's largest hospital on Monday, as Israeli troops and Hamas fighters battled near the compound.

The Al-Shifa facility in Gaza City has become a focal point in the territory's bloodiest ever war, which erupted five weeks ago.

On October 7, Hamas launched a wave of attacks on Israel that killed 1,200 people, most of them civilians.

Israel's relentless campaign in response has killed at least 11,180 people in Gaza, including 4,609 children, according to the Hamas government's media office.

On Sunday, witnesses at the hospital told AFP that "violent fighting" raged throughout the night.

The sounds of small arms fire and aerial bombardments were echoing across the sprawling complex, amid reports that the infirm -- including children -- were dying for lack of basic provisions.

The World Health Organization (WHO) and other UN agencies said as many as 3,000 patients and staff are sheltering inside without adequate fuel, water or food.

Doctors reported two incubated babies died after power was cut in the neonatal unit and a man had died when his ventilator shut down.

"Regrettably, the hospital is not functioning as a hospital anymore," said WHO director Tedros Adhanom Ghebreyesus, after making contact with on-the-ground staff.

"It's been three days without electricity, without water," he said, describing the situation inside as "dire and perilous."

- 'No longer functioning' -
Israel says that Hamas militants -- who also took 240 people hostage during their October 7 attacks -- are hiding inside the facility and underground tunnel complexes.

President Isaac Herzog has gone as far as describing Al-Shifa as Hamas's operational "headquarters", but denied that Israeli forces had targeted the facility.

Youssef Abu Rish, deputy health minister in the Hamas government, on Sunday said three more premature babies had died along with six other patients who had been in critical condition.

"We fear the toll will rise further by morning," he said.

Across Gaza City at the Al-Quds hospital the picture was also said to be dire, with the Palestinian Red Crescent warning it was now out of service due to lack of generator fuel.

Twenty of Gaza's 36 hospitals are "no longer functioning", according to the UN's humanitarian agency.

EU foreign policy chief Josep Borrell condemned Hamas for using "hospitals and civilians as human shields", while urging Israel to show "maximum restraint".

- 'Self-evacuation' -
With Israel facing intense pressure to minimise civilian deaths and suffering, the military on Sunday announced the opening of a "self-evacuation corridor" from Al-Shifa southward.

Tens of thousands of Gazans have already fled from the north of the territory under Israeli orders.

But it is unclear what provisions there would be for the sick and injured to be transported from Al-Shifa.

The Israeli army also said its ground soldiers had hand-delivered 300 litres of fuel to the hospital "for urgent medical purposes".

The military shared grainy night-time footage of combat troops hauling jerry cans and leaving a dozen or more outside a building.

AFP was unable to independently verify the footage, or Israel's claim that Hamas "forbade the hospital from taking it."

Only a handful of trucks carrying fuel had been let into Gaza since October 7, with Israel concerned fuel deliveries would be used by Hamas militants.

Al-Shifa director Mohammad Abu Salmiya told journalists the Israeli claims were "lies".

The 300 litres the army said had been delivered would power generators for "no more than quarter of an hour" anyway, Abu Salmiya said.

Inside the hospital, AFP last week witnessed the sick and injured on gurneys that packed corridor walls.

The courtyard of the emergency ward was dotted with people and piles of rubbish lay uncollected.

Some of the thousands displaced by the fighting camped at the facility using make-shift kitchens and what few supplies they had.

Almost 1.6 million people -- about two-thirds of Gaza's population -- have been internally displaced since October 7, according to the UN agency for Palestinian refugees UNRWA.

Israel's Prime Minister Benjamin Netanyahu has ruled out calls for the ceasefire, saying Hamas must first release the hostages.

Israelis, still stunned by the worst attack in their country's history and preoccupied with the fate of hostages, are in little mood to compromise.

A recent poll by the Israel Democracy Institute showed many Israelis back talks with Hamas to secure the release of hostages, but believe fighting should not be halted.

Netanyahu told US media that "there could be" a deal to free some of the hostages, but stopped short of providing any details.

"The less I say about it, the more I'll increase the chances that it materialises," he told NBC.

White House National Security Council spokesman John Kirby told MSNBC there has been "active negotiation" on a potential deal but kept mum on any details, while a Palestinian official in Gaza accused Israel of dragging its feet.

"Netanyahu is responsible for the delay and obstacles in reaching a preliminary agreement on the release of several prisoners," the official told AFP on condition of anonymity.