Hamas' armed wing has announced it will begin executing an Israeli civilian captive in return for any new Israeli bombing of civilian houses without pre-warning.

Abu Obaida, spokesperson for Hamas' armed wing, the IQB, said they have been acting in accordance with Islamic instructions by keeping Israeli captives safe.

'We have decided to put an end to this and as of now, we declare that any targeting of our people in their homes without prior warning will be regrettably faced with the execution of one the hostages of civilians we are holding,' he said.

Gaza City has been devastated by airstrikes today in response to the surprise attack launched by Hamas on Saturday.

In a video statement Monday, Israel's foreign minister warned Hamas against harming any of the hostages who were taken from Israel and being held in Gaza.

Eli Cohen said Israel was committed to bringing the hostages home 'in the spirit of mutual responsibility.'

'We demand Hamas not to harm any of the hostages, Cohen said. 'This war crime will not be forgiven,' he added.

Dozens of people are believed to have been taken hostage in Israel by Hamas fighters since the weekend.

They are now reportedly being held in locations across Gaza.

The Israel Defense Forces announced on October 9 it had carried out more than 500 strikes on targets across the Gaza Strip overnight.

Palestinian officials said almost 500 people were killed, including 91 children, and over 2,700 were injured.

This is after Israel had declared a 'complete siege' on Gaza earlier today, ensuring 'no electricity, no food, no fuel' for the 2.3mn people living in the Gaza Strip.

The country's defence minister said earlier today: 'We are fighting human animals, and we act accordingly.'

The EU also said today it would review all of its development funding to the Palestinian territories in response to Hamas' attack on Israel.