Israel and Hamas have reportedly signalled their agreement that neither of them would rule in Gaza during the second phase of a potential ceasefire and hostage exchange deal, a Washington Post column states.
According to the column by US journalist David Ignatius, the interim government will commence with phase two and security would be provided by forces trained by the US and backed by "moderate Arab allies".
The allies will be chosen from a core group of around 2,5000 supporters of the Palestinian Authority (PA) in Gaza who have been vetted by Israel.
The report adds that a US official said Hamas told mediators they were "prepared to relinquish authority to the interim governance arrangement".
The US has maintained that they were "cautiously optimistic" about ceasefire talks, with the White House national security spokesperson John Kirby telling CNN on Wednesday that things are moving in a good direction.
"There are still gaps remaining between the two sides. We believe those gaps can be narrowed, and that's what Brett McGurk and CIA Director Bill Burns are trying to do right now," he said.
Sources have also said ceasefire talks in Qatar will be resuming on Thursday, with Israel's defence minister Yoav Gallant saying that a limited window has been opened to bring captives back to Israel.
A senior Israeli official told Haaretz that they estimate that "an Israeli team can reach a deal based on the red lines drawn by Israel. There is a list of proposals and ideas which can, under certain conditions, placate both sides."
However, Hamas has maintained that they will only agree to a deal that allows for a total ceasefire and the withdrawal of Israeli forces.
Ceasefire talks
In a televised address this week, Hezbollah's Hassan Nasrallah said if a ceasefire deal was reached, the "Axis of Resistance" would stop its attacks on Israel.
"If there is a ceasefire in Gaza then our front will also cease fire without discussion, irrespective of any other agreement or mechanisms or negotiations," he said.
"Hamas is negotiating on its own behalf and on behalf of the Palestinian factions, and also on behalf of the entire Axis of Resistance. What Hamas accepts, we all accept," he added.
Israeli prime minister Benjamin Netanyahu has repeatedly attempted to derail ceasefire talks out of apparent fear it will lead to his government's collapse.
Defence officials who spoke with Haaretz said that the prime minister has been relying on classified intelligence and manipulating sensitive information to foil attempts to free captives held in Gaza.
One such strategy used by the now-disbanded war cabinet was the avoidance of discussing the number of Palestinian prisoners to be released for every Israeli captive.
Some people in Israel's negotiating team accused Netanyahu of cultivating public opposition to the deal and leaking information on prisoners' releases to reporters and presenting hardline positions.
This week, the Israeli military ordered all Palestinians to leave Gaza City and head south, as they renew their offensive across the north, south and central areas of the besieged Gaza Strip.
On Wednesday, Israeli forces again air-dropped leaflets urging everyone in Gaza City to leave the area and head south towards Deir al-Balah and Az-Zawayda.
However, Gaza's ministry of interior has called on residents to avoid following any evacuation orders from Israeli forces, adding that the instructions often cause further harm to Palestinians and are another form of psychological warfare against them.
The death toll from Israel's war on Gaza could be as high as 186,000, medical experts concluded this week in an analysis by the medical journal The Lancet.
The Palestinian ministry of health states that the war on the enclave has so far killed 38,193 people and wounded at least 87,903 others.