Israeli jets and helicopters launched dozens of air strikes across the Gaza Strip overnight on Monday, just hours after the bodies of three abducted Israeli teenagers were found in a shallow grave near the southern West Bank city of Hebron.

The air strikes, ostensibly in response to an ongoing barrage of rocket fire from Gaza into southern Israel, came after the Israeli prime minister, Binyamin Netanyahu, vowed the militant Islamist group Hamas, blamed by Israel for the kidnapping, would "pay a heavy price".

The United Nations human rights office urged on Tuesday all Israelis and Palestinians to exercise "maximum restraint" as the tension across Israel and occupied Palestinian territory escalated.

Eyal Yifrah, 19, Gilad Shaar, 16, and Naftali Frenkel, 16, who also had US citizenship, went missing while hitchhiking home from their religious schools in settlements on the West Bank on 12 June.

Their bodies were found by soldiers and volunteers in a valley covered with stones and brush on Monday afternoon.

The air strikes, which struck 34 locations in the Hamas-run Gaza Strip that Israel says were associated with Hamas and Islamic Jihad, came as troops on the West Bank killed an 18 year-old Palestinian during a raid in Jenin. Israeli authorities claim the teenager was a Hamas member who threw an explosive device at Israeli soldiers.

In Hebron, meanwhile, it was reported that the Israeli military had blown up the houses of two Hamas members named by Israel as suspects in the abduction Marwan Qawasmeh and Amer Abu Eisheh – the first punitive house demolitions since Israel halted the practice in 2005. The two men disappeared from their homes shortly after the abduction and have not been arrested.

Following the discovery of the missing Israeli's bodies on Monday, new details about the teenagers' abduction and murder 19 days ago while hitching home from West Bank religious schools have emerged in the Hebrew press, including the fact that investigators believe that the teenagers were killed within a few minutes of getting into a stolen car near Gush Etzion junction.

According to Israeli media reports, investigators found a bullet casing and other signs consistent with the youths being shot while sitting in the car, which was was later found abandoned and burned only a few kilometres from where their bodies were subsequently discovered. It is believed the three were shot shortly after one of the youths had managed to call an emergency hotline and whisper that they had been kidnapped after being alarmed that the car had made a sudden u-turn. Their bodies were buried in a field near the village of Halhul just north of one of the entrances to Hebron. Israeli officials believe the abductors had planned to trade the bodies for Palestinian prisoners in Israeli jails.

Binyamin Proper, who was among the civilian volunteers that found the bodies covered with piles of rocks, told Channel 2 TV that a member of the search party "saw something suspicious on the ground, plants that looked out of place, moved them and moved some rocks and then found the bodies. We realised it was them and we called the army".

The search for the missing teenagers prompted a vast Israeli military operation in the West Bank and the arrest of some 400 Palestinians – mainly Hamas members. The incident has dramatically increased tensions across Israel and the occupied Palestinian territories.

Prior to the discovery of the bodies, five Palestinians had been killed during the search operation.

The case, which has received rolling Israeli media coverage, has gripped the Israeli public, prompting mass rallies and a huge outpouring of public sympathy for the mothers of the three teenagers.

The families of Palestinians killed during the search – some of them also teenagers – have complained that the death of their children have been largely ignored in press coverage.

Following the discovery of the bodies on Monday, Netanyahu issued a statement once again blaming Hamas.

"Hamas is responsible, and Hamas will pay ... [They] were kidnapped and murdered in cold blood by wild beasts."

Israel's economy minister, Naftali Bennett, added his own statement vowing retaliation: "There can be no forgiveness for the killers of children and those who sent them. Now is the time to act."

For its part, Hamas has denied involvement. Spokesman Sami Abu Zuhri said on Monday: "Only the Israeli version of the events has been published."

"Israel is attempting to make way for aggression against us, against the Hamas ... No Palestinian group, Hamas or any other group, has taken responsibility for the action, and thus the Israeli version can't be trusted," he added.

A ball of fire is seen following an Israel airstrike in Rafah, southern Gaza. Photograph: Said Khatib/AFP/Getty Images

The Israel media reported on Tuesday morning that Netanyahu had faced splits in his Cabinet in its deliberations over how hard to retaliate both for the murders and the increased in rocket fire.

Senior officials stated both publicly and privately on Monday night and Tuesday morning that Israel was not seeking an "escalation with Hamas", suggesting that despite the rhetoric and the airstrikes in Gaza, retaliation might be limited.Several analysts in the Israeli media, including Amos Harel in Haaretz, have suggested Netanyahu is not keen to get embroiled in a long conflict with Hamas.

Messages of sympathy continued to come from international leaders who also called for calm. In a statement issue by his office, British prime minister David Cameron said: "I am deeply saddened by the news that the bodies of the three Israeli boys kidnapped on 12 June have been found this evening.

"This was an appalling and inexcusable act of terror perpetrated against young teenagers. Britain will stand with Israel as it seeks to bring to justice those responsible."

US president Barack Obama also issued a statement saying: "As a father, I cannot imagine the indescribable pain that the parents of these teenage boys are experiencing."

"The United States condemns in the strongest possible terms this senseless act of terror against innocent youth.

"From the outset, I have offered our full support to Israel and the Palestinian Authority to find the perpetrators of this crime and bring them to justice, and I encourage Israel and the PA to continue working together in that effort. I also urge all parties to refrain from steps that could further destabilise the situation. As the Israeli people deal with this tragedy, they have the full support and friendship of the United States."