In and around Gaza is where it is played out.

There are signs that following three days of fighting, the latest escalation in violence is subsiding after Egyptian efforts to mediate a ceasefire.

In the long run, apart from for those directly involved, this flare-up will likely barely register on the timeline of this decades-long conflict.

But it is a reminder that the conflict has not gone away.

As is usually the case, in terms of casualties, it is the Palestinians who have paid a heavier price.

Israeli air strikes have killed at least eight people in Gaza.

Seven are believed to have been militants. One was a 14-year-old boy.

A two-year-old girl was also killed on Tuesday, possibly in a botched attempt by Palestinian militants to fire a rocket.

Israel says more than 120 rockets and mortars have been fired across the border by militants since Monday causing fear, limited damage and a handful of injuries.

Re-asserting credentials?

Escalations such as this happen every few months.

But what has been unusual on this occasion is that Hamas has acknowledged being directly involved in rocket fire against Israel.

It is believed to be the first time the Islamist movement has done so for more than a year.

Ever since Israel's 2008-2009 three-week offensive in Gaza, aimed at stopping rocket fire, Hamas has largely refrained from carrying out attacks itself, even if it has allowed smaller militant groups such as Islamic Jihad to do so.

Many are asking why Hamas has chosen this moment to re-engage directly.

One theory is that the group is trying to re-assert its resistance credentials after criticism from other militant groups within Gaza that Hamas has compromised too much and has not been doing enough to resist Israel's ongoing occupation.

Some within Hamas's military wing have expressed concern that this has allowed a rival group, Islamic Jihad, to grow in strength.

Hamas has been in power since 2007, and for several years there has been a question over whether it can operate as both a government and at the same time continue its fight against Israel.

Launching scores of rockets over the past three days may be an attempt to remind Gazans that is can fill both roles.

Another theory is that Hamas is testing the waters in the shifting tides of the Arab Spring.

There is little doubt that Hamas feels bolstered by the rise of the Muslim Brotherhood in neighbouring Egypt.

Hamas was originally formed as a Palestinian offshoot of the Brotherhood, and the two have close ties.

Hamas chose to launch this week's attacks against Israel, just days after Egypt's presidential election in which the Muslim Brotherhood-backed candidate Mohammed Mursi appears to have got the most votes.

Hamas may feel that Israel would now have to think twice about launching another major offensive against Gaza with a less compliant Egypt next door.

Another war 'inevitable'

And this escalation may have had its origins not in Gaza, but in Egypt.

It coincided with an attack launched against Israel by Islamic militants from Egypt's increasingly lawless Sinai desert on Monday.

The group opened fire on Israeli construction workers, building the security fence along Israel's long border with Egypt.

It is unlikely they got the target they intended. One construction worker was killed: an Arab Israeli, or as they sometimes prefer to be called, a Palestinian living in Israel.

Two of the attackers were also killed.

Israel says some of its air strikes this week have been against Gaza-based militants who it believes helped plan Monday's operation in the Sinai.

For now, calm seems to be returning.

But this will not be the last flare-up in violence in and around Gaza.

One senior Israeli military commander told me earlier this month that, sooner or later, another war with Hamas is inevitable.