RAMALLAH, West Bank, March 12 (Reuters) - Israeli forces killed 31 Palestinians on Tuesday in their biggest offensive in the West Bank and Gaza since Israel captured the territories in the 1967 Middle East war.

Israeli armour and infantry stormed refugee camps and the West Bank city of Ramallah, where Palestinian President Yasser Arafat has his headquarters, on the eve of a U.S. truce mission.

U.N. Secretary-General Kofi Annan, in his harshest criticism of Israel, urged it to stop "the bombing of civilian areas, the assassinations, the unnecessary use of lethal force, the demolitions and the daily humiliation of ordinary Palestinians."

Hours after tanks occupied Ramallah, trapping Arafat in his office, two gunmen disguised as Israeli soldiers killed six Israelis at mid-day near the Lebanese border as tit-for-tat violence reached a new level of ferocity.

Major-General Gaby Ashkenazy, chief of Israel's northern command, said in an evening briefing the identities of the gunmen were not yet known and it was unclear whether they had come from Lebanon or from Palestinian-ruled areas.

"Both possibilities exist," he said, but noted the army had found no breach in Israel's border fence with Lebanon and that the ambush fit the pattern of Palestinian attacks elsewhere.

The cycle of violence threatened to derail U.S. envoy Anthony Zinni's mission before it starts.

The Israeli army's chief of staff, Lieutenant-General Shaul Mofaz, told a parliamentary committee the military had thrown 20,000 troops into action in the West Bank and Gaza Strip.

Even so, the scale of the offensive was not enough to satisfy two ultranationalist ministers who resigned from Prime Minister Ariel Sharon's coalition government on Tuesday.

Witnesses said 150 tanks thrust overnight into Ramallah and nearby refugee camps, tearing up roads and crushing cars in the main Palestinian commercial and political hub in the West Bank.

Heavy shooting broke out in some parts of the city of more than 200,000, and Israeli helicopter gunships opened fire on the al-Am'ari refugee camp on the city's outskirts. Arafat remained in his headquarters as the shooting erupted outside.

By mid-afternoon the usually bustling city streets were empty except for gunmen trying to resist troops who went from house to house searching for weapons and militants, accused of leading a Palestinian uprising against Israeli occupation.

In Ramallah's main square, angry Palestinians strung up the corpse of an alleged collaborator with the Israelis. The young man, blood staining his face and bare chest, dangled upside down by his feet from a metal pylon.

Israeli troops and tanks had battled their way into the Jabalya refugee camp in the Gaza Strip overnight, killing at least 17 Palestinians in fierce fighting, Palestinian hospital sources and witnesses said.

People ran screaming for cover down the camp's warren of alleys as the tanks surged into the densely populated camp of about 90,000 people. The army withdrew four hours later.

Nine Palestinians were killed in other violence in Gaza, and five died in the West Bank. The six Israelis and two gunmen killed in the Galilee attack, and an Israeli shot in the West Bank, took the total killed on both sides to 39 in 24 hours.

At least 1,054 Palestinians, including one who died on Tuesday of wounds suffered a month ago, and 340 Israelis have been killed since the uprising began after peace talks stalled.

The army said its offensive was intended to root out militants behind suicide bombings and other attacks on Israelis.

Soldiers had captured dozens of "hardcore" militants, confiscated weapons arsenals and located bomb-making factories in sweeps of refugee camps in recent days, said Colonel Gad Hirsch, head of Israeli military operations in the West Bank.

Some of the detainees were forced to stand blindfolded with their hands tied and stripped to their waists, witnesses said.

Palestinians accused Israel of trying to reoccupy the West Bank and Gaza Strip and sabotage Zinni's visit, expected to start on Thursday.

Palestinian Information Minister Yasser Abed Rabbo said Sharon's son, Omri, had told the Palestinians that Israel would reoccupy Ramallah but not attack Arafat's office.

"Sending Zinni to the region was a manoeuvre because we believe the United States was informed of Sharon's major offensive and intentions," Abed Rabbo said.

Sharon launched the offensive under pressure from right-wing critics to do more to end the uprising but also facing pressure from the left to hold peace talks.

The resignations of Tourism Minister Benjamin Elon and National Infrastructure Minister Avigdor Lieberman leave Sharon with a smaller majority in parliament and more dependent on his other coalition partners, but he is unlikely to fall from power.

Zinni, a former Marine Corps general appointed by Washington to reactivate dormant U.S. peace efforts, was due in the region to try to stem the bloodiest two weeks of fighting of the uprising so far. The violence has raised fears of all-out war.

Israel said on Monday it would lift a blockade on Arafat's movements after bottling him up in Ramallah for three months although he still needs Israeli permission to travel abroad.

Mid-East Realities

www.middleeast.org

Source: http://www.middleeast.org/articles/2002/3/695.htm