A Palestinian boy holds a toy gun as others hold banners calling to stop the sanctions on Gaza, during a protest organized by Hamas in Gaza City, March 10. Israeli Prime Minister Ehud Olmert ordered the army to scale back its operations in Gaza following a sharp drop in rocket fire from the Palestinian area, officials said. Photos: AP/Wide World Photos

The latest round of bloodletting in early March left more than 100 Palestinians dead. In addition, four Israeli soldiers died and Palestinian rockets for the first time slammed into a major Israeli city.

Few believe that the present tranquility is more than a temporary lull in the ongoing conflict between Israel and Hamas, which has controlled Gaza since violently routing the more moderate Fatah movement in June last year. It seems almost inevitable that some time in the coming weeks Israel will carry out a targeted assassination of Hamas militants in Gaza, or a rocket fired from the strip will slam into a home in Israel causing casualties, and again the violence will erupt.

The question being asked, however, is whether Israel will launch a major, wide-scale military operation in Gaza aimed at toppling Hamas and ending the rocket fire. The operation in early March, in which hundreds of troops backed by armored vehicles and warplanes moved on populated areas in northern Gaza in a bid to target those firing the rockets and destroy rocket stockpiles, was a limited operation.

News has begun trickling out in recent days of “new understandings” indirectly forged between Israel and Hamas, with the assistance of Egyptian and U.S. mediation. The basic formula entails no rocket fire on Israel by Palestinian militants in exchange for no attacks by the Israeli military in Gaza.

A recent statement by Israeli Prime Minister Ehud Olmert seems to back up these informal rules of engagement. “If they don’t fire Qassams (rockets) at us, we won’t attack in Gaza,” he said.

The understandings seem to be holding. Only three rockets were recently fired into Israel, compared with 50 a day when the fighting was raging in the first few days of March. The Israeli military, for its part, has withdrawn all troops from Gaza and has also stopped carrying out aerial attacks on Palestinian militants in the strip.

A new balance of deterrence seems to have emerged: If Israel targets Hamas militants, the Islamic movement will fire rockets into Israel, including at a major Israeli city. For the first time, during the latest round of fighting, Hamas fired longer-range, Iranian-supplied Grad missiles, hitting the populated neighborhoods of the port city of Ashkelon. Located just over six miles north of Gaza, it is home to 120,000 people. Until now, Hamas had confined its rocket fire to smaller Israeli communities closer to Gaza.

For Israel’s part, it has made clear to Hamas what the price will be if it again hits Ashkelon: More casualties after all the Palestinians killed and hundreds injured in just five days during the Israeli incursion into the strip.

Mr. Olmert’s options appear limited. In addition to the fear of incurring heavy losses if Israel does launch a major operation in Gaza, which would require guerrilla combat in densely populated towns and refugee camps with their narrow alleyways, there is no obvious exit strategy for the Israeli leader.

If Israel does succeed in significantly undermining Hamas during an extended operation, who will fill the vacuum in Gaza? The Fatah forces of Palestinian President Mahmoud Abbas, who were routed by Hamas militants last year, are in no state to retake control.

The possibility of an international peacekeeping force moving into Gaza also seems remote. It is difficult to see too many countries being prepared to place their troops in the crossfire between Israel and Hamas.

There is also no guarantee that after the operation ends—it could last weeks and maybe even months—and Israeli troops pull out of Gaza, the rocket fire won’t resume. In the hours after Israel withdrew its troops from Gaza following the latest incursion, Hamas militants launched a barrage of Qassams before ceasing the rocket fire, and declared victory. Mr. Olmert cannot be certain that this scenario won’t be repeated after a major ground incursion.

But if there is another attack, or if there are casualties in a rocket strike on Israel, or if Israel kills Hamas militants in an aerial strike, the brittle calm that descended will be shattered. What’s more, despite the reservations Mr. Olmert has talked about a wide-scale ground operation, if the rockets again slam into Ashkelon and there are casualties, he may ultimately succumb to public pressure for a major ground push into Gaza.