US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu have announced they have reached an agreement on a new Gaza peace plan.

The two leaders' plan calls for an immediate halt to military operations and for Hamas to hand over 20 Israeli hostages and the bodies of the dead within 72 hours.

In return, hundreds of Gaza hostages will be released.

In a statement after the leaders held talks at the White House, Trump hailed the plan as a "historic day for peace."

Netanyahu added that the US would support the "campaign to destroy Hamas that they have begun" if Hamas does not agree to the peace plan.

Netanyahu threatened that Israel would "finish what it started" if Hamas did not accept or implement the plan.

The Palestinian leadership, which governs the Israeli-occupied West Bank, said Trump's efforts were "decisive and genuine."

The US has outlined its plan for who will govern Gaza in the future.

Gaza will be temporarily run by a "politically neutral committee" and a "new international transitional governing body" will oversee its administration.

Former UK Prime Minister Tony Blair is expected to be part of this oversight body.