By Nidal al-Mughrabi

CAIRO, June 7 (Reuters) - An Israeli airstrike on a Hamas-led police station in the Gaza Strip killed five Palestinians and wounded at least 16 others on Sunday, health officials said, as mediators began new efforts to salvage a fragile U.S.-brokered ceasefire deal.

Medics did not say how many of the casualties were police. The strike hit a police post adjacent to a large tent encampment of displaced families in Khan Younis in the south of the enclave.The Israeli military did not immediately comment on the incident.

PARIS, June 7 (Reuters) - Israeli settlers could face further sanctions in coming days in protest at the escalation of illegal settlements in the West Bank and a surge in violence by settlers against Palestinians, French Foreign Minister Jean-Noel Barrot said on Sunday.

The European Union imposed sanctions on Israeli settlers and organisations that support them late last month.

JERUSALEM, June 7 (Reuters) - A 35-year-old man was killed and five others injured in a series of shootings on Sunday in central Israel near the occupied West Bank that police described as a suspected terror attack.

A police spokesperson said the suspected gunman, an Israeli Arab from the nearby Israeli city Tayibe, was also killed and a firearm was found in his possession. Israeli media reported a second suspect was also killed.

Israel and Iran traded fire on Monday, seriously testing a fragile truce and threatening hopes for a deal to end the Middle East war.

The new attacks, including a strike on an Iranian petrochemical complex, came hours after US President Donald Trump called on Israel to refrain from retaliating against Tehran's missiles.

AFP journalists in Jerusalem heard a series of explosions as they took shelter and the Israeli army said it worked to intercept a new wave of Iranian missiles.

By Phil Stewart

WASHINGTON, June 7 (Reuters) - Fourteen weeks after President Donald Trump ordered an attack on Iran, the U.S. military is adjusting to an unusual state of conflict that is not full-scale war, but also far from peace.

On ships and bases in the Middle East, U.S. troops — some recovering from injuries — operate amid exchanges of fire with Iran every few days as the Navy blockades Iran's ports. At home, the Pentagon is scrambling to bolster production of depleted munitions as families of service members cope with the stress of extended deployments.

Israel's military struck Beirut's southern suburbs on Sunday, hitting apartments in two buildings after saying it had intercepted rockets launched by Hezbollah into Israeli territory.

The Lebanese health ministry said the attack in the capital killed two people and wounded 20 others, including four children and four women.

Israel and Hezbollah regularly exchange fire in southern Lebanon but the capital -- including districts seen as bastions of the Iran-backed group -- has been relatively spared of late, having been struck only twice since mid-April.

By Lucy Papachristou

YEREVAN, June 7 (Reuters) - Armenians head to the polls on Sunday in a parliamentary election seen as a test of the government's efforts to forge a peace deal after a crushing military defeat by Azerbaijan three years ago.

Polls show Prime Minister Nikol Pashinyan's ruling Civil Contract party leading, backed by up to 32% of voters, with the pro-Russian Strong Armenia party trailing in second place with up to 11%.

OPEC+ ministers meet Sunday to weigh higher production quotas in a bid to cap oil prices that have surged since the Iran war effectively choked off Gulf crude shipments.

But even if the cartel members vow to ramp up output by thousands of barrels per day, analysts say geopolitical realities mean they probably won't move the needle on prices.

With the crucial Strait of Hormuz shut since US and Israeli attacks on Iran in late February, oil prices have nearly doubled, igniting inflation pressures worldwide.

By David Lawder, Eman Abouhassira and Ahmed Elimam

WASHINGTON/DUBAI, June 7 (Reuters) - The U.S. government will attempt to redirect Iranian assets to Gulf states for rebuilding and repairs of future damage caused by Iran, a source familiar with the matter said on Saturday, a day after a wave of attacks by Iran against Kuwait and Bahrain.

U.S. Treasury Secretary Scott Bessent has also directed a team to assess costs for damage already inflicted on Gulf allies by Iran, the source said, adding that the U.S. will consider using Iranian assets for those repairs as well.

By John Irish

PARIS, June 6 (Reuters) - France is working with several countries to step up pressure on Israel by pressing ahead with coordinated national sanctions targeting individuals linked to violence in the West Bank, three European diplomats said on Saturday.

The measures, which would include asset freezes and travel bans, have yet to be finalised and countries may adopt different lists of individuals, the diplomats said.