Israel-Gaza updates: Nasser Hospital no longer 'functional,' WHO chief says

The delegation that Israel sent to Egypt to take part in negotiations on Tuesday over a potential cease-fire or hostage deal with Hamas will not return for more talks this week, an Israeli political source told ABC News on Wednesday.

Officials from Egypt, Qatar and the United States have been mediating talks between Israel and Hamas since war broke out on Oct. 7.

Israeli Prime Minister Benjamin Netanyahu said Wednesday that negotiations "can move forward" when "Hamas drop[s] their delusional demands."

But Israeli labor leader Merav Michaeli is criticizing the prime minister, saying, "Netanyahu's refusal to send a delegation to the follow-up talks on the hostage deal shows, once again, that he really does not see an urgent need to bring the hostages home. We must not allow Netanyahu to abandon our hostages for the benefit of his political survival."

-ABC News' Jordana Miller and Morgan Winsor

A U.S. citizen has died in the West Bank, the State Department confirmed on Tuesday -- marking what is potentially the second killing of an American in the occupied territory in recent weeks.

State Department Spokesperson Matthew Miller said during a press briefing on Tuesday that the administration was "still in the gathering information stage." He did not provide additional details, including identifying information for the deceased or the apparent cause of death.

The death comes after a 17-year-old Palestinian-American was fatally shot in the West Bank on Jan. 19. Israeli police said at the time that its internal affairs department was investigating a firearm discharge involving an off-duty law enforcement officer, a soldier and a civilian.

-ABC News' Shannon K. Crawford

The U.S. believes Israel is still "acting in good faith" on hostage negotiations, State Department spokesperson Matt Miller told reporters during a press briefing on Tuesday.

Miller was mostly tight-lipped on the latest round of discussions with Egypt, the U.S. and Qatar in Cairo, though he did say that the U.S. assesses that Israel still shares the administration's interest in reaching an agreement despite its potentially looming Rafah offensive and reports of the country's limited involvement in the talks.

"We have seen public statements from the government of Israel that they want to secure the release of hostages," Miller said.

Prime Minister Benjamin Netanyahu also reiterated to Secretary Antony Blinken last week in Israel that it is a "top priority" for him to secure the release of the hostages, Miller continued.

"So yes, we do believe they're acting in good faith," he said.

-ABC News' Shannon K. Crawford

Top intelligence officials from Israel, the U.S., Qatar and Egypt are meeting in Cairo Tuesday for a new round of hostage deal discussions.

The Israeli delegation will not present a revised proposal to negotiators; they have come only to listen to possible options by the other partners, according to Israeli sources close to the negotiations.

Israeli Prime Minister Benjamin Netanyahu rejected the draft proposal his own team came up with hours before they departed for Egypt.

-ABC News' Jordana Miller