Prime Minister Ehud Olmert declared in Sunday's cabinet meeting that he rejected any criticism of the morality of the IDF. "The IDF is the most moral army in the world," the prime minister said. "It does not and never has made a policy of targeting civilians." Olmert's words came as the IDF continued its investigation into the cause of the explosion that killed seven Palestinians on a Gaza beach on Friday, with the initial assumption being that an errant artillery shell was to blame, Defense Minister Amir Peretz said Saturday night that it was possible the blast was an "internal Palestinian incident." IDF officers said that an "internal Palestinian incident" referred to the possibility that terrorists had fired a Kassam rocket which went off target and hit the crowded Gaza beach between Sudaniya and Beit Lahiya. Still, although Israel had yet to take responsibility for the incident as of Saturday night, one officer thought that a shell fired by IDF artillery cannons was the likeliest cause. "We have ruled out the possibility that the explosion was caused by rockets fired by air or sea," this officer said. "The strongest remaining possibility is artillery fire." First Palestinian reports of the blast ascribed it to a shell fired from a navy warship that was patrolling off the coast. But the IDF found that no warships or fighter planes had been firing at the time. Peretz set up an investigative committee, headed by Maj.-General Meir Calify of the Ground Forces Command, and ordered that it present its findings by Tuesday evening at latest. Peretz also ordered a suspension of all artillery fire until the completion of the investigation. The IDF said it regretted the harm caused to innocent civilians and offered the Palestinians any assistance needed, including evacuation to Israeli hospitals. Two of the wounded were indeed being treated in Israeli hospitals. "There is information indicating that it was an internal Palestinian incident," Peretz told reporters during a visit to the Gaza Strip division on Saturday. "There is new information, but we should wait until the end of the investigation since this incident has international ramifications." Israel, Peretz added, had no intention to harm innocent Palestinians. He called on Hamas and the Palestinian Authority to restrain terror groups to prevent an escalation of the conflict. Moments earlier, Chief of General Staff Lt.-Gen Dan Halutz spoke to the press and expressed regret for what he called an "unfortunate incident." But, Halutz said, his regret did not mean that he was taking responsibility for the incident. He called on the PA to cooperate with the investigation. Halutz refused to rule out the possibility that the IDF would continue firing at Kassam launch sites as part of its effort to curb attacks. "We have utilized artillery power in the past, and we will continue utilizing artillery power under major and strict restrictions," he said. Asked if the IDF would minimize the use of artillery fire against Kassam launch sites, Peretz said, "Every option will be considered. I will accept all decisions made [by the IDF], but I suggest we demonstrate patience until the end of the investigation." Peretz said he relayed a message to PA President Mahmoud Abbas on Saturday in which he expressed his regret over the incident and urged the PA leader to prevent an escalation in violence. "We have no interest in an escalation," Peretz said. "A defense minister who believes that peace is the only true way is currently standing before you." OC Gaza Brig.-Gen. Aviv Kochavi said that after a navy- or IAF-fired rocket had been ruled out, the two possibilities remaining were either a shell fired by a cannon or "an internal Palestinian incident." The IDF, he said, had yet to receive information it had requested from the PA which would assist in determining the source of the explosion. "We are conducting an extremely thorough investigation," Kochavi said. "We have asked the Palestinians for information that we were missing and we have yet to receive that information." Kochavi said that around the time of the incident five shells were fired from a distance of 200-250 meters from the scene of the explosion but were not capable of causing such a disaster.