Israel’s dramatic weekend rescue of four hostages from the Gaza Strip, in an operation that local health officials say killed 274 Palestinians, came at a sensitive time in the 8-month-old war, as Israel and Hamas weigh a US proposal for a ceasefire and the release of the remaining captives.

Both sides face renewed pressure to make a deal. The complex rescue is unlikely to be replicated on a scale big enough to bring back scores of remaining hostages, and it was a powerful reminder for Israelis that there are still surviving captives held in harsh conditions. Hamas, meanwhile, now has four fewer bargaining chips.

But both could also dig in, as they have repeatedly over months of indirect negotiations mediated by the US, Qatar and Egypt. Hamas is still insisting on an end to the war as part of any agreement, while Israel says it is committed to destroying the militant group.

Here is a look at the fallout from the operation and how it might affect ceasefire talks.

Elation and mounting calls for a deal

The rescue operation was Israel’s most successful since the start of the war, bringing home four of the roughly 250 captives seized by Hamas in its October 7 attack on Israel. The four include Noa Argamani, who became an icon of the struggle to free the hostages.

However, the raid killed at least 274 Palestinians, according to the Gaza Health Ministry, deepening the suffering of people who have had to endure the brutal war and a humanitarian catastrophe. The ministry does not distinguish between fighters and civilians in its tallies.

The rescue was greeted with elation in Israel, which is still reeling from the October attack and agonising over the fate of the surviving 80 captives and the remains of more than 40 others still held in Gaza. Israeli hardliners are likely to use it as proof that military pressure alone will bring the rest back.

Israeli soldiers move near the Israeli-Gaza border as seen from southern Israel. Photo / AP

But only three other hostages have been freed by military force since the start of the war. Another three were mistakenly killed by Israeli forces after they escaped on their own, and Hamas says others have been killed in Israeli airstrikes.

“If anyone believes that yesterday’s operation absolves the government of the need to strike a deal, they are living a fantasy,” Israeli columnist Nahum Barnea wrote in the mass-selling Yediot Aharonot newspaper. “There are people out there who need to be saved, and the sooner the better.”

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Even the Israeli Defence Force’s spokesman, Rear Admiral Daniel Hagari, acknowledged the limits of military force. “What will bring most of the hostages back home alive is a deal,” he told reporters.

More than 100 hostages were released during a week-long ceasefire last year, in exchange for Palestinians imprisoned in Israel, and reaching a similar agreement is still widely seen as the only way of getting the rest of the hostages back. Hours after Saturday’s rescue, tens of thousands of Israelis attended protests in Tel Aviv calling for such a deal.

US President Joe Biden last week announced a proposal for a phased ceasefire and hostage release, setting in motion his administration’s most concentrated diplomatic push for a truce.

Biden described it as an Israeli proposal but Israeli Prime Minister Benjamin Netanyahu has publicly questioned some aspects of it, particularly its call for the withdrawal of Israel’s forces from Gaza and a lasting truce. His ultranationalist coalition partners have threatened to bring down his government if he ends the war without destroying Hamas.

That appears only to have deepened suspicions on the part of Hamas, which has demanded international guarantees that the war will end. It’s unclear if such guarantees have been offered, and Hamas has not yet officially responded to the plan.

Netanyahu seeks to gain

Israelis protest against Prime Minister Benjamin Netanyahu's government and call for the release of hostages held in the Gaza Strip. Photo / AP

The rescue operation was a rare win for Netanyahu, whom many Israelis blame for the security failures leading up to the October 7 attack and the failure to return the hostages.

He has revelled in the operation’s success, rushing to greet the freed hostages in hospital in front of television cameras. The rescue will likely help to rehabilitate his image.

But as the elation fades, he will still face heavy pressure from an American administration that wants to wind down the war and an ultranationalist base that wants to vanquish Hamas at all costs. His main political opponent, the retired general Benny Gantz, quit the emergency wartime coalition on Sunday, leaving Netanyahu even more beholden to the hardliners.

Netanyahu is already facing criticism from some of the families of dead hostages, who say they received no publicised visits and accuse him of taking credit only for the war’s successes. Israel is also likely to face increased international pressure over the raid’s high death toll.

“The success in freeing four hostages is a magnificent tactical victory that has not changed our deplorable strategic situation,” columnist Ben Caspit wrote in Israel’s Maariv daily.

It all makes for a tough balancing act, even for someone like Netanyahu, whom friends and foes alike consider to be a master politician.

The operation could provide the kind of domestic boost that would allow him to justify making a deal with Hamas. Or he might conclude that time is on his side and that he can drive a harder bargain with the militants.

Hamas loses bargaining chips

Hamas has lost four precious bargaining chips it had hoped to trade for high-profile Palestinian prisoners. Argamani, widely known from a video showing her pleading for her life as militants dragged her away on a motorcycle, was a particularly significant loss for Hamas.

The raid may have also dealt a blow to Hamas’ morale. On October 7 it managed to humiliate a country with a far superior army and, since then, it has repeatedly regrouped despite devastating assaults across Gaza.

But the fact that Israel was able to mount such a complex rescue in daylight in the centre of a crowded urban area has restored, at least temporarily, some of the mystique that Israel’s security forces lost on October 7.

Israeli soldiers near the Israeli-Gaza border in southern Israel. Photo / AP

The rescue also refocused global attention on the hostage crisis at a time when the US is rallying international pressure on Hamas to accept the ceasefire deal.

But Hamas has a long history of withstanding pressure from Israel and others, often at enormous cost to Palestinians. The militants may conclude that it’s best to use the remaining hostages to end the war while they still can – or they might just look for better places to hide them.