TEL AVIV, Israel (Ma'an) -- Israeli Defense Minister Ehud Barak said Saturday that "Israel regrets the death of Egyptian police officers during the terror attack at the Egypt-Israel border."
Israel's Ynet news site said Barak's remarks came after assessing recent events. His country's ties with Egypt deteriorated since Thursday, when Cairo accused Israel's army of killing Egyptian security forces.
Barak gave orders for a joint military investigation with Egypt's army, Ynet reported.
Egyptian state television said earlier that Cairo decided to withdraw its ambassador from Israel to protest the deaths on the border during retaliatory attacks on Palestinian militants.
"Egypt has decided to withdraw its ambassador to Israel until there is an official apology," it said.
The Egyptian government had asked "for an official apology from Israel" at the end of a crisis meeting overnight, the state-run MENA news agency.
But Israeli foreign ministry spokesman Yigal Palmor said that "at no time has Israel been officially notified of a recall of the Egyptian ambassador."
Egyptian officials privately said discussions on the matter were still underway and that no decision had been reached yet.
Hundreds demonstrated outside the Israeli embassy in Cairo overnight and demanded the expulsion of the Israeli ambassador.
"Sinai, Sinai," the crowds shouted in reference to the Sinai peninsula where the killings occurred, and "Down with Israel. The people want the ambassador out and the Israeli flag down."
On Saturday dozens were still camped outside the building housing the embassy and some torched Israeli flags, an AFP photographer said, as riot and military police stood guard.
Prime Minister Essam Sharaf also expressed his anger in a message on his Facebook page.
"Egyptian blood is too precious to be spilled for no reason," wrote Sharaf.
"Our glorious revolution took place so that Egyptians could regain their dignity at home and abroad. What was tolerated in pre-revolution Egypt will not be in post-revolution Egypt," he said, referring to the ouster of president Hosni Mubarak.
Egypt's ambassador to the Palestinian Authority, Yasser Othman, told Ma'an in Ramallah that "what is needed from Israel is a formal apology and a commitment to never do this again."
Asked how recalling Egypt's ambassador from Tel Aviv would help the dispute, Othman said the move "sends a strong message to Israel that Egypt stands by its civilians and soldiers."
But Israel is not interested in escalating tensions with Egypt, he added.
Hamas meanwhile applauded Egypt's decision to withdraw the ambassador, saying it was an appropriate response to Israel's "crime of killing three Egyptians in addition to the Palestinian martyrs.”
Israel's ongoing bombardments across Gaza have left 14 Palestinians dead since Thursday and 44 injured, among them 11 children, 10 women, and three elderly people, medics say.
Seven Palestinians died late Friday and early Saturday at the height of the assault which Israel says is an ongoing response to a series of attacks Thursday that killed eight Israeli citizens.
Cairo, meanwhile, has been exerting efforts to calm tensions between Israel and factions in Gaza following a sharp escalation in violence, said the Egyptian envoy in Ramallah.
Both sides have reached an initial agreement to restore a ceasefire between Israel and factions in the Gaza Strip. Egypt is mediating to stop "Israel's aggression on Gaza," Othman said.