Israel's planned annexation of parts of the occupied West Bank would be a "declaration of war", Gaza rulers Hamas said on Thursday, as a UN envoy warned the move could fuel violence.

Israeli Prime Minister Benjamin Netanyahu aims to table annexation plans from July 1, despite opposition from the Palestinians and much of the international community.

In a televised address, Hamas's military wing said such a move would prompt a war with the Palestinians.

"The resistance considers the decision to annex the West Bank and the Jordan Valley to be a declaration of war on our people," said spokesman Abu Ubaida.

Gaza has been under a crippling Israel blockade since 2007, when Hamas took control of the Palestinian enclave.

Hamas and Israel have fought three wars in recent years, with the latest conflict in 2014 killing 2,251 Palestinians and 74 people on the Israeli side.

There are no official relations between the two sides and the Palestinian Authority, a separate administration based in the West Bank, last month cut its cooperation with Israel.

Israel's proposal to annex its settlements in the West Bank and the Jordan Valley form part of a broader US peace plan published in January.

The proposals foresee the ultimate creation of a Palestinian state on the remaining West Bank territory and including the Gaza Strip.

But the plan falls far short of Palestinian aspirations, with a state on reduced territory and without East Jerusalem as a capital.

Palestinian officials cut diplomatic relations with Washington in 2017, over its pro-Israel stance, and have rejected the US peace plan.

The United Nations has raised alarm bells in recent weeks over Netanyahu's intentions, warning they could do irrevocable damage to Israeli-Palestinian relations.

Speaking in Jerusalem on Thursday, the UN's Middle East envoy Nickolay Mladenov said annexation may also fuel violence.

If Palestinians "feel that there is no prospect of a peaceful resolution to the conflict, that only creates opportunities for radicals", he told journalists.

Mladenov pointed to a "long litany of such developments" in the Middle East, referring to the rise of the Daesh group in Iraq and Syria.

Mladenov was speaking a day after a UN Security Council session in which Secretary General Antonio Guterres, as well as European and Arab powers, called on Netanyahu to end his annexation ambitions.

They view the move as illegal under international law, although the US has broken with this consensus and said Israel has the right to decide.

While countries are yet to announce retaliatory measures, Mladenov warned Israeli annexation could spark a regional conflict.

"Nobody wants another war, another flare-up of violence in the Middle East, and certainly not one that has such a potential to ignite conflict way beyond its borders," he said.