Olmert vowed no ceasefire at a meeting of mayors in Tel Aviv. "There is no ceasefire and there will be no ceasefire in the coming days," he told the mayors, adding the fighting with Hezbollah is continuing.

The offensive against Hezbollah would end only when it ceases being a threat to Israel, said Olmert.

"Israel is continuing to fight. We will stop the war when the (rocket) threat is removed ..., our captive soldiers return home in peace, and you are able to live in safety and security," he said. He said that although Hezbollah's operational capability has been severely damaged, Israel should still keep alert for missiles and rockets in the coming days.

Israel had no choice but to begin its attacks on Hezbollah after the guerrillas carried out their cross-border attack, in which eight other soldiers were killed, he said.

Earlier in the day, Defense Minister Amir Peretz told the Knesset (parliament) that the army would expand its offensive against Hezbollah guerrillas who kidnapped two Israeli soldiers and killed eight on July 12 and triggered the violence.