Israel would let aid enter Gaza via Egypt, Prime Minister Benjamin Netanyahu's office announced Wednesday, saying only "food, water and medicine" would be allowed into the blockaded Palestinian enclave.

"In light of (US) President (Joe) Biden's demand, Israel would not foil the supply of humanitarian aid via Egypt," the prime minister's office said, announcing a cabinet decision.

The statement noted that aid to civilians in the southern Gaza Strip would be allowed "so long as these supplies do not reach Hamas", which rules Gaza.

While Israel said it would allow for aid to pass through Egypt, it maintained that supplies would not come from its own territory until Hamas releases the dozens of hostages it took in a massive attack on October 7, which spiralled into all-out war.

"Israel demands Red Cross visits with our captives and is working to mobilise broad international support for this demand," the statement added. 

Water, fuel and food supplies are running low in Gaza, under a crippling Israeli-led blockade since Hamas Islamists took power in 2007.

Israel effectively sealed off the coastal enclave following the October 7 attack.

The Israeli announcement came as Biden ended a high-stakes visit, where he offered Israeli leaders continued US support and backed his ally's stance that Palestinian militants were behind a deadly rocket strike on a Gaza hospital.