LONDON (AFP) - Thousands of Palestinians have fled their homes but have nowhere safe to shelter from Israeli airstrikes, charity Oxfam said on Wednesday, warning supplies of water and food are dangerously low.

Over 120,000 people are displaced but are prevented from escaping violence because borders with Israel and Egypt are shut, Oxfam said.

"The terrible toll on civilians is shocking. Hospitals and water supplies are under massive strain and the needs are increasing by the day. People are fleeing terrified," said Nishant Pandey, Oxfam's head in Occupied Palestinian Territory and Israel.

Normally such crises would cause people to flee the area, but this was impossible as the blockade prevented people escaping the violence, Pandey said.

"Lasting peace and security for both sides means ending the blockade and the collective punishment of people in Gaza." The charity said water supplies were disrupted to over one million people, raw sewage was at risk of contaminating the water due to the destruction of sanitation plants, and only half of Gaza's sewage plants are working.

Much of the area, a densely populated strip of land along the Mediterranean Sea, has electricity for four hours a day or less, Oxfam said.

The charity said it was trucking water supplies to 19,000 people sheltering in a mosque, a church, schools and Al Shifa hospital, but that airstrikes made it difficult to deliver aid, and that many of its staff had also had to leave their homes.