Israeli air strikes on Gaza dominated the Gulf Arab leaders' economic summit as the oil-producing region looks to better co-ordinate policies to face the global financial crisis in Muscat.

The two-day summit which concludes today (Tuesday) will lay focus on the annual heads of state meeting who are set to approve a long-planned pact that could take them closer to issuing a single currency before a self-imposed 2010 deadline for monetary union.

'(Gaza) is the most prominent event on the summit,' Abdel-Rahman al-Attiyah, secretary-general of the Gulf Co-operation Council (GCC), told reporters after an opening session of leaders on Monday.

'Gaza was discussed yesterday, has been discussed in the meetings today and will be discussed tomorrow at all levels. It will be reflected in the summit statement and therefore this issue is one of the hottest in the summit.'

More than 325 Palestinians have been killed in three days of attacks in the Hamas-ruled Gaza Strip and a United Nations body said at least 51 of the dead were civilians.

'(Gaza) is the most prominent event on the summit,' said GCC secretary-general Abdulrahman Al Attiyah after an opening session of leaders in the Omani capital.

The prime minister of Qatar, the only Gulf state with an Israeli envoy, called the attacks on Gaza 'savage and unjustified'.

Shaikh Hamad bin Jassim bin Jaber Al Thani told Israeli Foreign Minister Tzipi Livni in a telephone conversation that 'Arabs feel that Israel had no intention of achieving peace'.

An Arab foreign ministers meeting in Cairo tomorrow would discuss holding an emergency Arab summit on Gaza but Saudi Foreign Minister Prince Saud Al Faisal said: 'There would be no benefit in attending an Arab summit for statements,' suggesting that Riyadh was not in favour of such a meeting.