JUDY WOODRUFF: Now to the Middle East, where there has been a major escalation of tensions just in the last few hours. It follows days of unrest sparked by the deaths of three Israeli teens and a Palestinian teenager. Three Israeli suspects in the killing of the Palestinian teen confessed to the crime today.

Prime Minister Benjamin Netanyahu phoned the teen's father and vowed the killers would be brought to justice. Tonight, Hamas fired dozens of rockets into Israel, claiming revenge for Israeli airstrikes overnight which they say killed six of its members.

A short time ago, I spoke to Josef Federman, whose story covering — who has been covering a story for the Associated Press.

Josef, thank you for talking with us.

Bring us up to date on what is going on. What is each side doing?

JOSEF FEDERMAN, The Associated Press: Well, it's been a pretty busy day here.

Things are heating up in Southern Israel along the Gaza border. Gaza militants have fired about 100 rockets today into Israel or at Israel. Israel has responded with some limited airstrikes earlier in the day. Now, the rocket fire heated up, really intensified this evening. There was a barrage of nearly 50 rockets after nightfall.

Some of them flew — or they set off alarms deep inside of Israel, about 50 miles away from the border, reaching almost the outskirts of Tel Aviv. So this is seen as a bit of an escalation. Israel hasn't responded yet to this latest barrage, but we're expecting a pretty long night.

JUDY WOODRUFF: How is this different from what normally has been taking place there?

JOSEF FEDERMAN: Well, most of the time, the rocket fire is pretty limited to — when there are attacks — and there are periods when it's quiet altogether — but usually it's limited to one or two or a handful of rockets that are fired at very short distances into open areas.

Now we are seeing just an intensity that we haven't seen for several years, where it's dozens and dozens each day. The distance that they're flying is a lot further and many of them are reaching populated areas.

JUDY WOODRUFF: And tell us more about Israel's response. We know — you mentioned the airstrikes. They're calling up reservists as well, right?

JOSEF FEDERMAN: Yes, what we have seen is, Israel is moving forces down toward the border. We had AP people along the border today.

We saw pictures of rows and rows of tanks and buses filled with soldiers, people kind of milling around the border area. Even this evening, the roads are empty down there because most people are staying inside bomb shelters with all the rockets flying. The only traffic you see on the roads basically are military vehicles bringing tanks, armored vehicles and so forth.

So Israel seems to be bracing. The consensus, the speculation is that Israel will begin by limiting its activity to aerial bombardments. I don't think they are going to send in ground troops, at least at this stage, but what we're expecting is a much more intense, a heavier response than what you have been seeing earlier.

For the most part, Israel has been going after military Hamas training bases and fields and launching sites. What you may see are sort of higher-value targets, places where maybe there are forces. You may see more casualties and so forth. So that's the type of thing I'm expecting to see in the next few hours.

JUDY WOODRUFF: We also know that the Palestinian president, Mahmoud Abbas, has been speaking out. What is he saying? What is he trying to do?

JOSEF FEDERMAN: He's actually been pretty quiet on the situation in Gaza. He always speaks out against violence. Any time there's loss of Palestinian life — and there were eight Palestinian militants killed today — he always condemns that.

But his focus has actually been on the situation in Jerusalem and in the West Bank. As you probably know, things are also heating up in Israel following the death of a Palestinian teenager last week. Israel has arrested some Jewish Israelis as suspects, and the Palestinians are very upset about this incident. And that's something where President Abbas has been focusing his attention.

JUDY WOODRUFF: And what is the reaction in Israel? We reported that some of the suspects who were arrested, the Israeli suspects, have now confessed to the killing of the Palestinian teenager. How is that being received?

JOSEF FEDERMAN: Yes, the arrests — and we still don't have the identities. A lot of the information on this case is being kept under wraps right now as the investigation continues.

You what little we do know is that the suspects are Jewish. Authorities say that three people confessed today. And it has really set off some soul-searching in Israel. I think there's just a lot of shock because of the brutality and how grisly this killing was, where they burned somebody alive.

So people are having a hard time coming to terms with this. And even the nation's top leaders, Shimon Peres, the president, a Nobel Peace Prize winner, called the family, the boy's parents, today to express his condolences and just told them how shocked he was and how ashamed. And you hear that word a lot, the word shame. You see it in newspaper columns, among politicians.

Even Prime Minister Benjamin Netanyahu also reached out and called the family today. And you don't normally see Israeli leaders reaching across the aisle toward Palestinians.

JUDY WOODRUFF: So, just quickly, to sum up, Josef Federman, you said, Israel, both sides are bracing for something worse?

JOSEF FEDERMAN: I think so.

Hamas, this morning, after it suffered casualties — like I said, eight militants were killed overnight last night — and that was the heaviest death toll that we have seen so far. They immediately vowed revenge. And then we see 100 rockets flying throughout the course of the day.

So I think the militant groups in Gaza are expecting something, and Israel almost always responds, and especially after a barrage of this intensity. It's really impossible for Israel to sit back and not do anything. There is just so much public pressure to do something. So it really almost seems inevitable that you're going to see more fighting in the coming hours.

JUDY WOODRUFF: Josef Federman of the Associated Press, we thank you.

JOSEF FEDERMAN: Thank you.

JUDY WOODRUFF: And joining me now to help us understand these latest developments are Dennis Ross, a longtime U.S. diplomat and Middle East envoy serving in the George H.W. Bush, Clinton and Obama administrations. He's now a counselor at the Washington Institute for Near East Policy. And Shibley Telhami, he's the Anwar Sadat professor of peace and development at the University of Maryland, senior fellow at the Brookings Institution, and author of the book "The World Through Arab Eyes."

And we thank you both. Women come back to the NewsHour.

Dennis Ross, to you first.

Any question about what has set off this latest round of violence?

DENNIS ROSS, Former U.S. Envoy to Middle East: Well, I do think it was connected to the kidnappings of the three Israeli teenagers.

The Israelis held Hamas responsible for that. And you began to see the beginnings of what was this process of tit for tat after that. Now you have the revenge killing, which, as we heard from the report, has created a shock wave within Israel. But it takes place against the backdrop of increasing tension with Hamas and Gaza.

And you have each side, it seems to me, in a position where they really don't want to be looking like they're backing down. Hamas now vows revenge because, you know, eight of their — eight of their operatives were killed last night, and they sense that there's a hesitancy on the part of Israelis to come in on the ground.

And it's almost as if they're testing to see how far the Israelis will go, but even they don't want to go too far because if they really provoke the Israelis to coming in on the ground, they don't know what the result of that is going to be, and the Israelis, even though the price to Israel might be high, the price to Hamas could be even greater.

JUDY WOODRUFF: Shibley Telhami, how do you read what is going on and how the Palestinian leadership is reading it?

SHIBLEY TELHAMI, University of Maryland: Well, I think there is what Dennis said, but I think it's much deeper than that.

I happened to be there in Jerusalem and Ramallah when the Israelis were kidnapped. And my sense, my feel, particularly in Ramallah right after, was that it felt like 1987 again. 1987 was the start of the first Palestinian intifada.

And there were some things that were so similar, Palestinian despair over the distraction in the Arab world by other problems, what's happening in Iraq, and Egypt, and Syria. In the 1980s, Palestinian were frustrated that attention was going to Iraq and the Iraq-Iran War and people weren't paying attention to their issues.

There was frustration with the leadership that was detached from the population. The PLO had been exiled in Tunis after 1982. And there was a sense that the people had to do something on their own. There is that sense of alienation.

In fact, both Mahmoud Abbas and the Hamas risk being irrelevant, which is one reason why they came together, to be more relevant in the national unity government. So you have the combination that is combustible. And then when you have a — on top of that, the failure of American diplomacy and a sense of resignation that maybe there won't be a two-state solution, it was a disaster waiting for a spark. And we have the spark.

JUDY WOODRUFF: Is it clear — I gather from both of your answers, Dennis Ross, that it's not really clear what the leadership on each side is prepared to do, how far they're prepared to take this.

DENNIS ROSS: Well, I think that's exactly right.

And I do think there is a combustible mix right now. But we have also two different realities taking place. We have the reality in Jerusalem, which may or may not be containable. We have the reality in Gaza, which also confronts each side, meaning Hamas and the Israeli leadership, with some hard choices.

Now, at this point, where is the leadership? In the case of Israeli Prime Minister Benjamin Netanyahu, you can see that on the one hand, he wants to make it clear to Hamas there's a terrible price to be paid if they continue to try to provoke Israel. On the other hand, he himself is saying this is not a time for hasty decisions, this is not a time for emotional decisions. This is a time for judicious behavior.

And also the fact that he reaches out to the parents of the Palestinian teen who was killed is also a signal that says, look, we are going to act against our excesses. What happened was shameful and we're a country that is ruled by law, and we're going to act.

And that's also both a reflection of I think a deep-seated feeling, but also a desire to send a signal that the last thing we want to see is an explosion with the Palestinians.

JUDY WOODRUFF: Shibley Telhami, pick up on that, and talk about the forces that are pushing each side to take this farther and the forces that are saying, no, let's pull back.

SHIBLEY TELHAMI: Well, my own sense is that Hamas leadership, the political leadership in Hamas, and the prime minister of Israel really don't want an escalation at this time. It's too costly for them. It's disrupts their priorities. They are not ready for it. But they may be dragged in that direction.

Why? Because look at the divisions, first of all, within Israel. It's not just public opinion. Public opinion is one set of problems. But look at — when the prime minister of Israel starts sounding like he's the moderate in his own government, you can tell that you have got a problem on your hand.

In Hamas, they have two problems. One problem is they, just like Israelis, want to — they learned from Hezbollah that when they feel under attack or they will lose, they have to retaliate, just like the Israelis feel that pressure. There is that dynamic.

There are groups within Gaza that they can't fully control. They have been firing some of the missiles, the rockets across the Israeli borders. And we don't know how divided they are. The deal to have a national unity government and proceed with a political process was somewhat controversial within Hamas.

And so we don't know what forces are at play. When you have a political environment and a public that is mobilized and angry, people are going to play to that public.

JUDY WOODRUFF: And how much is the public on both sides, Dennis Ross, pushing this to more of a crisis point than it already is?

DENNIS ROSS: I don't think the public on each side is actually pushing this to a crisis point.

I do think there's a level of despair on the Palestinian side. I think there's a level of anger on the Israeli side. But I think you have, in a sense, certain constituencies that may be in the forefront of pushing. Shibley made reference to the pressures under Prime Minister Netanyahu.

We see it in terms of Former Minister Lieberman now splitting off from the — not leaving the government, but splitting from the coalition with the party.

JUDY WOODRUFF: … government.

DENNIS ROSS: That's right.

We see it in terms of what I will call the military wing of Hamas. I mean, they're the ones who launched the rockets today. Up until now, they have not been the ones who have been launching the rockets. So, you can see segments on each side who see an emotional moment and are reacting to that.

Now, the question is, is there sufficient control of leaders to be able to do that? I think, on the Israeli side, there is. I think, on the Palestinian side, it's much more of an open question.

JUDY WOODRUFF: How would you answer that?

SHIBLEY TELHAMI: Well, I think, on both sides, it's an open question, I think in part because this Israeli government has got a lot of people on the right who want to take — who are running for the next prime minister position in the Israeli election.

And they're exploiting this, just like there are people on the Palestinian side who want to go toward militancy. So, I think even though neither side really want a full escalation, they could very well go there. And it takes — we saw what it took, killing of several individuals, horrible killing, that dragged people into a situational confrontation.

JUDY WOODRUFF: Yes.

Well, a lot of questions coming out of this. And we thank you both for coming in to talk to us tonight, Shibley Telhami, Dennis Ross. Thank you.

DENNIS ROSS: Pleasure.

SHIBLEY TELHAMI: Thank you.

JUDY WOODRUFF: Thank you.