(Clarifies about second casualty, paragraph 11)
GAZA, May 12 (Reuters) - Israel closed a main border crossing with the Gaza Strip and destroyed a Hamas militant tunnel on Saturday, a day after renewed violence between Palestinian protesters and Israeli forces on the edge of the coastal enclave.
Dozens of Palestinian demonstrators had broken into the Gaza side of the Kerem Shalom terminal, the main conduit for goods in and out of the territory, on Friday. They set alight a pipeline that delivers gas from Israel, torched a conveyor belt and damaged a fuel pipe.
"The crossing will remain closed until the damage caused by the riots are repaired and will reopen in accordance with a situation assessment," the Israeli military said.
It will be opened for humanitarian cases only in the meantime, it said.
Later on Saturday, Israeli war planes destroyed an underground attack tunnel near the border that was being built by Hamas, the Islamist group that controls Gaza, to help militants cross into Israel, the military said.
The tunnel had reached just a few meters from the border, adjacent to Israeli communities, the military said.
"It was approximately one kilometer long. It was dug over a number of months and we have been following it for a number of weeks," spokesman Lt. Col. Jonathan Conricus said.
Israel says it has destroyed several cross-border militant tunnels in recent months. Palestinian gunmen used tunnels to blindside Israeli forces during the 2014 Gaza war.
EMBASSY TO OPEN
More than two million people are packed into the narrow Gaza Strip, where poverty and unemployment rates are high. Kerem Shalom is one of three main Gaza border crossings with Israel and Egypt, but it is where most goods pass through daily.
The incursion into Kerem Shalom took place during a weekly mass protest in which thousands of Palestinians gathered along the Israel-Gaza border.
Palestinian health officials said a man was killed by Israeli fire on Friday and that a 15-year-old boy who was shot died from his wounds on Saturday. The Israeli military said the crowd had grown violent and that troops were defending the border.
More than 40 Palestinians have been killed during six weeks of protests and tens of thousands of Gazans are expected at tented border encampments in the coming days.
It was unclear to some Gaza residents why the demonstrators chose to attack the terminal.
"I cannot find one good reason for what happened, what is the wisdom behind this?" said one gas station owner, who asked not to be identified.
"Some petrol stations have storage for maybe a day or two, so the crisis will begin by Monday or Tuesday should the crossing remained closed," he said.
The Palestinian National Committee said it was surprised by the "non-deliberate and unfortunate incident" at Kerem Shalom and called on Palestinians to preserve the crossings.
Gaza is run by Hamas, which Israel and the West designate a terrorist organization. Citing security concerns, Israel maintains tight control over its land and sea borders. Egypt also restricts movement in and out of Gaza.
The border protests are building to a climax on May 15, the day Palestinians call the "Nakba" or "Catastrophe", marking the displacement of hundreds of thousands of Palestinians in the conflict surrounding the creation of Israel in 1948.
They take place at a time of growing frustration over the prospects for an independent Palestinian state. Peace talks between Israel and the Palestinians have been stalled for several years and Israeli settlements in the occupied territories have expanded.
U.S. President Donald Trump's decision last year to recognise disputed Jerusalem as Israel's capital and move the U.S. Embassy there further fueled Palestinian anger. The new embassy is due to open on Monday.
(Reporting by Nidal al-Mughrabi and Ari Rabinovitch, Editing by Angus MacSwan)