Amid reports that cease-fire negotiations between Hamas and Israel have fallen through, the U.S. State Department is saying hope still remains for a deal. The State Department also refuted the notion that President Joe Biden's decision to halt some arms transfers to Israel — and his assertion that he will cut off additional shipments if the country invades Rafah — had weakened its position at the negotiating table.

"That is not at all our assessment of the hostage talks. We actually think that a Rafah operation would weaken Israel’s position both in these talks and writ large," State Department spokesperson Matt Miller said, arguing a major incursion would "further weaken Israel’s standing in the world."

Although the paused arm shipments won’t impact Israel’s readiness to conduct a major operation in Rafah, some U.S. officials who have long been skeptical that Hamas will ever agree to a deal that involves handing over all of the hostages say the group could interpret the move (and Biden’s public warning) as a compelling sign that support for Israel among its closest allies is beginning to crumble.

Despite the heightened tensions between the Biden administration and Benjamin Netanyahu’s government, Miller said the U.S. would continue to work with Israel in the hopes of reaching a deal.

"We continue to engage with the Israeli government on the amendments to the proposal that Hamas submitted earlier this week,” Miller said. “We continue to work to try to finalize the text, try to get an agreement. And I will just say that any effort like this is incredibly difficult. This one has certainly been incredibly difficult, but we will continue to stay engaged because we believe it's in the interest of all parties."

-ABC News' Shannon Crawford

Amid tensions between the U.S. and Israel over the invasion of Rafah, Israeli Prime Minister Benjamin Netanyahu said Israel will stand alone if it has to.

"Today we are much stronger. We are determined, and we are united to defeat our enemy and those who seek our souls. If we have to stand alone, we will stand alone," Netanyahu said in a statement Thursday.

"I already said that if we have to - we will fight tooth and nail," Netanyahu said.

Following threats from President Joe Biden to cut off arms to Israel if it launches a full-scale invasion of Rafah, the Israel Defense Forces say they have the armaments they need for operations in Rafah.

"The IDF has armaments for the missions it plans, and we also have what we need for the missions in Rafah. I say this in the context of everything that has come up with the United States and it is important to say it," Daniel Hagari, a spokesperson for the IDF, said Thursday.

"The United States has provided security assistance to the State of Israel and the IDF so far in an unprecedented way during the war, what is no less important than this is the military assistance and cooperation of the American Central Command and the IDF," Hagari said.

Israel's insistence on maintaining its ability to operate throughout Gaza against Hamas was a major sticking point in cease-fire negotiations that have fallen through, a senior Israeli official told ABC News.

The official said Israel will have to operate in Rafah, even if a deal is struck. One of the key problems Israel sees with the proposed deal is the demand for an end to the war when Hamas is still "well established" in Rafah.

-ABC News' Will Gretsky

Although the Biden administration said it expected the Kerem Shalom and Rafah gates to be at least partially opened for humanitarian aid by Wednesday, the State Department was much less optimistic. However, the U.S. vowed it would continue to press Israel to get both portals up and running again.

While Kerem Shalom reopened Wednesday, aid had not been allowed to pass through because of "logistical and security concerns on the ground," State Department spokesperson Matt Miller said during a briefing Wednesday. He also said fuel had not been able to enter Gaza through Rafah.

"We think it's critical that Rafah be open for fuel because without fuel deliveries into Rafah, humanitarian assistance that comes in through Kerem Shalom can't actually be delivered. The two are critically linked," Miller said. "We're continuing to push for that to happen."

Miller didn’t provide any updated timeline on when the U.S. expected the crossings would be functional again, but said it was imperative that Israel act to increase the amount of aid allowed into Gaza following what he described as a "fairly dramatic dip" this week.

"When it comes to the level of humanitarian assistance, the results as they are today are just unacceptable. There's no other way to put it," Miller lamented.

He continued, "We are making quite clear to the government of Israel that we need to see those decreases reversed. We need to get back to where we were, and we need to see the levels continue to increase and see those sustained, and that is why we need to see Kerem Shalom and Rafah opened."

-ABC News' Shannon Crawford