An Israeli official has told Walla! news that the chance of a lasting ceasefire deal before the current temporary truce expires on Monday night is very slim.
Speaking on condition of anonymity, the official said the gulf between the two sides' position meant that finding a compromise would be nearly impossible.
Israeli and Palestinian negotiators are poised to resume indirect talks with Egyptian mediators on reaching a more permanent ceasefire before a current truce expires at midnight on Monday.
The Egyptian government persuaded both sides late Wednesday to adhere to a new five-day ceasefire, extending an earlier three-day agreement in order to allow more time to thrash out a longer-term truce. According to a report by Israel Radio on Saturday, Egypt has said it will not be submitting any further truce proposals after this one, which includes 11 separate points addressing key issues for both sides.
It got off to a rocky start with Palestinian rocket attacks and retaliatory Israeli air strikes, but Saturday marked a sixth day of quiet following more than a month of fighting that has killed at least 1,980 Palestinians and 67 on the Israeli side.
Israeli and Palestinian negotiating teams are expected back in Cairo for fresh talks, which the Palestinians said would begin on Sunday, after consulting their political leaders over the weekend.
The European Union welcomed the ceasefire in Gaza and said it was ready to expand a police mission in Rafah, on the border with Egypt, and train Palestinian Authority customs personnel and police for redeployment in Gaza.
"A return to the status quo prior to the latest conflict is not an option," said the EU Council on Friday following a foreign ministers' meeting in Brussels.
It said EU police would monitor the transit of supplies needed for Gaza reconstruction and try to prevent weapons from being smuggled into the territory.
A mission of 70 European police officers was set up at the crossing point in 2005, tasked with monitoring movements of people, goods and vehicles at Gaza's only window to the outside world that bypasses Israel.
But it was suspended two years later after Hamas seized power in the Gaza Strip.
The EU said a durable ceasefire must be accompanied by lifting closures on Gaza and called on "all terrorist groups" in the territory to disarm.
The Israeli foreign ministry welcomed the call for disarmament - Israel's main demand at Cairo truce talks.
"Commitment to the principle of demilitarization, to be implemented by an effective mechanism, will ensure a fundamental change of the situation," it said.
Israel, under pressure from citizens who have endured more than 2,790 rocket attacks since July 8, refuses to countenance any major reconstruction effort without full demilitarization.
Lifting the blockade
Azzam al-Ahmad, who heads the Palestinian delegation at the Cairo talks, told AFP on Saturday he was quietly optimistic that an agreement for a longer-term truce could be reached.
"We have high hopes of reaching an agreement very soon, before the end of the truce, and perhaps even, very quickly, for a permanent ceasefire," he said.
But Hamas spokesman Sami Abu Zuhri struck a hardline note, insisting that there can be no return to peace without a lifting of Israel's eight-year blockade of the Islamist-ruled coastal enclave.
"We can reach an agreement if the Israeli side accepts all the demands of the unified Palestinian delegation, in particular the end of any aggression against our people, the war on Gaza and the complete lifting of the siege," Abu Zuhri said.
The Israelis have spoken little in public about the negotiations.
With demands seemingly irreconcilable, the Egyptian mediators and both sides will have their work cut out to hammer out a wording that each side can present as some kind of achievement.
Israel refuses to deal directly with Hamas, whose charter calls for the destruction of the Jewish state. Hamas is one of three factions within the Palestinian delegation, which also includes Islamic Jihad and the Palestinian Authority.
Talks on Sunday are expected to resume on the basis of an Egyptian proposal, which calls for a lasting ceasefire beyond Monday midnight, and new talks on the thorniest issues, including demands for a seaport and airport in Gaza, to begin in a month's time.
Negotiations about handing over the remains of two Israeli soldiers in exchange for the release of Palestinian prisoners in Israeli jails would also be postponed, according to the document.
A buffer zone along Gaza's border with Israel would be gradually reduced and guarded by Palestinian Authority security teams.