Hamas and Israel have signed off on the “first phase” of Donald Trump’s peace plan, with the terror group pledging to release all hostages.

The breakthrough, which represents a major step in bringing to a close the two-year conflict, was struck following talks between both sides and US, Qatari, Egyptian and Turkish mediators in Egypt.

Mr Trump called the agreement a “historic and unprecedented event”, hailing it as the first step towards peace in the Middle East.

“I am very proud to announce that Israel and Hamas have both signed off on the first phase of our peace plan,” the US president posted on Truth Social.

“This means that all of the hostages will be released very soon, and Israel will withdraw their troops to an agreed upon line as the first steps toward a strong, durable, and everlasting peace. All parties will be treated fairly!

“This is a great day for the Arab and Muslim world, Israel, all surrounding nations, and the United States of America, and we thank the mediators from Qatar, Egypt, and Turkey, who worked with us to make this historic and unprecedented event happen. Blessed are the peacemakers!”

Earlier on Wednesday, Mr Trump cut short a roundtable at the White House after Marco Rubio, the US secretary of state, passed him a note saying negotiators were “very close” to striking an agreement.

Following the announcement, Benjamin Netanyahu, the Israeli prime minister, said of the hostages: “With God’s help, we will bring them all home.”