In-person talks on a Gaza cease-fire-for-hostages agreement have concluded for now with no deal but the U.S. believes remaining gaps can be surmounted, the White House said on Friday.

"Obviously we don't have a deal and that's deeply regrettable," White House national security spokesperson John Kirby told reporters.

He said that while the in-person meetings have ended, "we are working hard to keep both sides engaged in continuing the discussion, if only virtually."

"We still believe that a deal is possible," he said. He said an agreement will require leadership and moral courage.

Kirby also said the U.S. is watching Israel's military operations in the southern Gaza city of Rafah with concern and wants the Rafah crossing reopened immediately.

He said the activity did not appear to reflect a large-scale invasion.

"It appears to be localized near the crossing and largely with the forces they had put in there at the beginning. That said, we are watching it with concern," Kirby said.

"One again we urge the Israelis to open up that crossing to humanitarian assistance immediately," he added.