Israeli Prime Minister Benjamin Netanyahu has reaffirmed his decision to stop allowing the import of humanitarian aid into the Gaza Strip.

"There will be no free lunches," the Israeli leader said at a cabinet meeting in Jerusalem on Sunday.

"If Hamas thinks that it will be possible to continue the ceasefire or benefit from the terms of the first stage, without us receiving hostages, it is sorely mistaken," he said.

If Hamas persists in its position, there will be "further consequences," which the Israeli leader did not list.

Netanyahu announced the decision after Israel and Hamas were unable to agree on an extension to a six-week ceasefire in the Gaza war.