European Union lawmakers urged Israel on Thursday not to inflict "collective punishment" on Gaza's population, saying its isolation of the territory had failed and its actions were endangering civilians.

They urged Israel to lift a blockade which has cut supplies to the 1.5 million people living in Gaza, run by the Islamist group Hamas, and let in aid and essential goods and services.

"The policy of isolation of the Gaza strip has failed at both the political and humanitarian level," the European Parliament said in an adopted resolution.

"The civilian population should be exempt from any military action and any collective punishment."

Israeli air strikes and ground incursions into the Gaza Strip have killed some 300 Palestinians in the past year, including dozens of civilians, but have failed to prevent rocket fire, which killed two Israelis in the same period.

"The European Parliament calls on Israel to cease military actions killing and endangering civilians, and extrajudicial targeted killings," the resolution said.

The lawmakers also urged the Gaza Strip's rulers Hamas to prevent the firing of rockets into Israel.

They called on the Palestinian Authority, led by President Mahmoud Abbas, to launch a dialogue with Hamas, an Islamist militant group which is on the EU's list of terrorist organizations.

EU lawmakers have no power over the bloc's foreign policy.

Foreign Minister Tzipi Livni met with the European Union's special envoy to the Middle East Marc Otte on Thursday and told him that "Israel wants to advance in the political process, but we can't afford to close our eyes in the face of the difficult reality of terrorism in Gaza."

"Europe must understand that the choice is between Hamas, or the moderates," she added. "The international community's desire to see changes on the ground leads to a general disregard of the real situation in Gaza, and to pressure to make compromises that Israel cannot afford."

Earlier Thursday, Livni said that the Palestinian people had no future under Hamas, adding that Israel would continue its campaign against the terror created by the Islamist group.

Livni met Thursday with her Romanian counterpart, amid mounting international pressure on Israel over its handling of the situation in the Gaza Strip.

"Europe must internalize that Hamas is not an organization interested in the establishment of a Palestinian state," Livni said, following the talks with Romanian Foreign Minister Adrian Cioroianu. "It is not seeking Palestinian rights, but rather wants to take rights away from others."

She added: "All the indirect support for Hamas - even if nade through discussions on opening border crossings or on the humanitarian situation - only weakens those interested in reaching an agreement."