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Monday July 5, 2010 2:55 PM (EST+7)

ANKARA, July 5 (Reuters) - Turkey will cut ties with Israel unless it receives an apology over a deadly Israeli raid on a Turkish aid ship bound for Gaza, Foreign Minister Ahmet Davutoglu was quoted as saying on Monday.

Israel has three paths ahead: It either apologizes, or accepts the findings from an international commission investigating the raid, or Turkey will cut off ties, Davutoglu told Hurriyet newspaper.

Once Israel's closest Muslim ally, Turkey has said several times it wants Israel to apologise over the May 31 raid, pay compensation, agree to a U.N. inquiry into the incident and lift the blockade of 1.6 million Palestinians living in Gaza Strip.

Turkey has said before it was reviewing ties with the Jewish state. But Davutoglu's words are the first time Ankara has explicitly threatened to sever ties unless its demands are met.

Israel has opened its own inquiry.

Davutoglu met Israel's Trade and Industry Minister Benjamin Ben-Eliezer last week in Brussels in talks aimed at mending fences. Turkey said then it had told Israel what it should do to repair ties.

The messages conveyed to Ben-Eliezer have reached the Israeli government. We will not wait forever for an answer, Davutoglu told Hurriyet's Monday edition.

It will be enough if their own commission rules that the raid was unfair and they apologize in line with the commission's verdict, but we have to see the verdict first.

Nine Turkish pro-Palestinian activists were killed when Israeli commandos stormed the Turkish-flagged ship Mavi Marmara on May 31 as part of an operation to stop a relief aid flotilla headed for Israeli-blockaded Gaza.

Turkey withdrew its ambassador to Israel, cancelled joint military operations and barred Israeli military aircraft from Turkish airspace after the incident.

The United States wants Israel and Turkey, whose earlier friendship had benefited U.S. policy in the Middle East, to patch up the dispute. President Barack Obama is due to meet Israel's Benjamin Netanyahu in Washington on Tuesday.

Israel has maintained its commandos opened fire only after a boarding party was attacked by activists wielding clubs and knives.

Israel says the Gaza blockade is needed to choke off the supply of arms to Hamas Islamists who rule the enclave.

Relations between Israel and Turkey have been on a downward spiral since Prime Minister Tayyip Erdogan spoke out forcefully against an Israeli offensive in Gaza at the end of 2008.

The two countries had forged a friendship in the 1990s largely based on military cooperation and intelligence sharing, though trade also prospered.

Turkey has improved relations with neighbors such as Iran and Syria in recent years and Erdogan became a popular figure among Muslim countries for championing the Palestinian cause. (Editing by Charles Dick)

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