US and Iraqi forces killed an estimated 15 Al Qaeda gunmen during a fierce battle south of Baghdad after the fighters launched a major attack on recently formed neighbourhood patrols, the US military said on Tuesday.

Hamas rounded up at least 200 Fateh party members in Gaza on Tuesday, the day after Islamist gunmen killed seven people at a mass rally that underscored the deep divisions between rival Palestinians.

Israeli and Palestinian presidents Shimon Peres and Mahmoud Abbas on Tuesday hailed an upcoming Middle East peace conference as an historic opportunity while warning that failure could spell fresh trouble for the region.