A spokesman for the military wing of Hamas claimed a "substantial breakthrough" in talks for a prisoner exchange with Israel.
The deal, being brokered by Egypt, would bring about the release of Cpl Gilad Shalit, who was abducted in a cross-border raid on 25 June, in a phased exchange for hundreds of Palestinian security prisoners. But Cpl Shalit's family and Israeli officials denied Arab media reports that they had already received a video proving he was alive. The Hamas spokesman, Abu Abeida, told Israel Radio: "If things continue to progress in the channel in which they are progressing, I foresee a rapid deal, and in the very short term."
Abu Mujahed, a spokesman for the Palestinian Resistance Committees, one of the three groups holding the kidnapped soldier, told The Independent: "We have accepted a phased exchange. In the first stage, Israel would release a number of prisoners and we would give Shalit to the Egyptian authorities. In the second stage, Israel would release more prisoners. Egypt then would hand Shalit to the Israeli authorities. These positions have been accepted by all three groups."
The Egyptians, he added, were still trying to complete the agreement. He praised Israel for the seriousness with which it was handling the exchange. However, Sa'eb Erakat, who negotiates on behalf of the more moderate President Mahmoud Abbas, said talk of an early exchange was premature.
Israeli sources were saying little on the record, but claimed that Hamas had lowered the price for releasing Cpl Shalit. The main stumbling block, they suggested, was the list of candidates it wanted freed from Israeli prisons. Ehud Olmert, the Prime Minister, has indicated that Israel would be "generous" if the terms were right.
Abu Mujahed said: "We are demanding 1,400 prisoners. We're not making any compromise on numbers."