Hamas has reportedly agreed to allow Israeli troops to remain in Gaza in a major about-turn that could unblock a hostage deal.

The Palestinian terror group has also handed over a list of hostages, including US citizens, who would be freed under a ceasefire agreement, according to mediators.

The reversal has raised hopes that a deal could finally be struck after more than a year of fighting, which was sparked by Hamas’s attack on Oct 7 that killed 1,200 Israelis.

The fundamental sticking point blocking a deal has been over what a ceasefire would look like in practice.

Israel has taken control of more parts of Gaza since the war broke out last year, including the Philadelphi Corridor along the Egyptian border, as well as the Netzarim Corridor, which divides the north and south of the territory.

Benjamin Netanyahu, the Israeli prime minister, believes these areas should remain under Israeli control after any ceasefire, something Hamas had previously refused to agree to.