Hamas has claimed responsibility for a deadly gun attack at a busy bus stop in west Jerusalem in which three Israelis were killed on Thursday morning, prompting the prime minister, Benjamin Netanyahu, to pledge to eliminate the Palestinian group whenever the hostage release halts.

The shooting overshadowed negotiations aimed at extending the existing truce in Gaza, but despite the attack, Egypt and Qatar remained hopeful of securing a two-day extension in return for the release of another 20 hostages and a further 60 Palestinians held in Israeli jails.

Two women, aged 24 and 65, and a man, 72, were shot and killed when two gunmen, brothers from East Jerusalem, opened fire at about 7.40am with an assault rifle and a handgun, shooting at a crowd of people waiting at on the western edge of the city. Thirteen others were injured, police said.

The gunmen were shot dead less than a minute later, after they retreated to their car, by two off-duty soldiers and an armed civilian. Shortly after the deadly incident there were named by Israel’s Shin Bet internal security agency as Hamas members Murad Namr, 38, and Ibrahim Namr, 30.

A few hours later, Hamas’s armed wing, al-Qassam Brigades, claimed responsibility. A statement posted on the group’s Telegram channel said the operation was in response “to the occupation’s crimes of killing children and women in Gaza and the occupied West Bank”.

Surveillance video footage showed two men rushing out of a car parked in front of the bus stop, brandishing guns at the crowd. People fled in terror before the two men retreated to the vehicle, where police said they were killed.

Media reports said that the women killed were Livia Dickman, a 24-year-old teacher who was pregnant, and Hanna Ifergan, a school principal aged 65. The man who was shot dead was Elimelech Wasserman, 72, a rabbinical judge. An initial report that a 16-year-old girl was also killed was incorrect.

Netanyahu said “Hamas murderers” had struck in Jerusalem, and said it was “the same Hamas that perpetrated the terrible massacre on October 7th and the same Hamas that is trying to murder us everywhere”.

Speaking after a meeting with Antony Blinken, the US secretary of state, the Israeli leader said he had told his counterpart: “We have sworn, I have sworn, to eliminate Hamas. Nothing will stop us.”

The war in Gaza, he added, would continue until Israel had achieved three goals: freeing all the remaining hostages held by Hamas, completely eliminating the group, and “ensuring that no threat like this will ever come from Gaza again”.

A US spokesperson said that Blinken had reiterated Washington’s support for “Israel’s right to protect itself from terrorist violence in compliance with international humanitarian law” but insisted that Jerusalem must continue to avoid civilian harm in any future combat operations.

Israel has repeatedly signalled it intends to attack the crowded southern part of the Gaza Strip, where 2 million people have fled to escape from ground fighting in the north. But Blinken’s spokesperson said that he “stressed the imperative of accounting for humanitarian and civilian protection needs in southern Gaza before any military operations there.”

Two hostages were released by Hamas in the late afternoon, Mia Schem, 21, and Amit Soussana, 40, part of a total of 10 expected to be released later on Thursday in exchange for a continuation of the truce in Gaza for a seventh day.

No more mothers and children will remain in captivity if Thursday’s release goes to schedule, apart from Shiri Bibas and her children Ariel and Kfir, who Hamas says were killed in bombing on Gaza. Isreal’s military is in the process of trying to confirm if they are dead.

The initial agreement between Israel and Hamas, brokered by the US and Qatar, states that the truce can be extended a day for every 10 hostages released. At the same time Israel has agreed to release three Palestinian prisoners for every Israeli hostage coming from Gaza.

Schem, a dual Israeli-French citizen, is a tattoo artist who was captured at the Supernova desert rave on 7 October, in circumstances that are not yet clear. Soussana, a lawyer, was kidnapped from Kfar Aza kibbutz while trying to hide from Hamas attackers.

Israeli police said the initial investigation of the bus stop attack indicated the attackers had arrived by car and were “armed with an M16 rifle and a handgun”. They began shooting at civilians before being killed at the scene. A search of the car had “revealed ammunition and weaponry”, the force added.

Shin Bet said the gunmen had previously been jailed for terror activity. The elder brother, Murad, spent 10 years in jail to 2020 for planning terror attacks, under direction from Gaza, while Ibrahim had been jailed in 2014.

Itamar Ben-Gvir, Israel’s security minister and leader of the far-right Otzma Yehudit party, visited the scene and said the attack at the bus stop showed that the country needed to respond to Hamas militarily.

“This type of incident proves again how much we can’t show weakness,” he said, according to the Times of Israel. Ben-Gvir has previously called for an end to the current truce.

Blinken also met the Palestinian Authority president, Mahmoud Abbas, on Thursday evening. He condemned extremist violence against Palestinians in the West Bank and said the US remained committed “to advancing tangible steps” for a Palestinian state, according to a spokesperson.

Abbas called for a complete ceasefire in Gaza, Al Jazeera reported, and raised the topic of the enforced displacement of Palestinians in the Gaza Strip and in the West Bank, and warned there had been increased attacks from Israeli settlers since 7 October.