JERUSALEM — The European Union pressed Israel Monday to lift the blockade of Gaza, deeming it "unacceptable" while the Israeli Cabinet approved an investigation into the deadly raid on a Gaza-bound flotilla in an effort to counter international criticism.

EU members met in Luxembourg to discuss ways Europe could renew its role in helping supervise Gaza's volatile border crossings. Mideast mediator Tony Blair said he hopes Israel will soon ease the three-year-old blockade by allowing commercial goods and reconstruction materials to flow into the Palestinian territory.

Israel has rejected heavy pressure for an international investigation into the May 31 raid on a Gaza-bound international flotilla aimed at busting the blockade. Israeli soldiers killed nine pro-Palestinian activists. Israel claims the United Nations and other global bodies have a long history of bias against Israel. But in consultation with its key U.S. ally, Israel agreed to add two high-ranking foreign observers to try to bolster the credibility of its investigation.

Before the Cabinet voted on the investigation, Prime Minister Benjamin Netanyahu said he was confident the makeup of the commission — to be headed by a retired Supreme Court justice — would blunt international criticism and prove Israel handled the affair responsibly.

"I am convinced that the commission's uncovering of the facts will prove that the goals and actions of the state of Israel and the Israeli military were appropriate defensive actions in accordance with the highest international standards," he said.

The White House has backed Israel's inquiry, calling it "an important step forward."

The raid has increased Israel's diplomatic isolation while generating new sympathy for Gazans and boosting the Islamic Hamas rulers of the territory, who refused to recognize Israel and to renounce violence. Diplomatic pressure has been building for Israel to ease or end the blockade, most notably from the White House.

Israel, along with Egypt, imposed the blockade after Hamas militants violently seized power three years ago. Israel says it is needed to prevent Hamas, which has fired thousands of rockets into Israel, from rearming. Israel also wants to pressure Hamas to release a captured Israeli soldier it has held for four years.

But critics say the blockade, which allows in little more than food and humanitarian items, has hurt the vast majority of Gaza's 1.5 million people, while failing to weaken Hamas.

In Luxembourg, the 27-nation EU began meeting on the blockade and described it "unacceptable and counterproductive" in a draft statement.

"The most important part of what we can do is to try and provide support to actually get the crossings open and to ... help people rebuild their homes, to provide for businesses, to try to support everyday things," EU foreign affairs chief Catherine Ashton said.

Among the proposals being floated are giving the EU, which managed Gaza's main passenger crossing with Egypt before the Hamas takeover, a renewed role.

EU officials including Blair said there were indications Israel may agree to relax its blockade of Gaza by opening at least one border crossing to large-scale commercial traffic. EU diplomats also said Israel would likely drop its restrictive list of goods permitted into the region, and instead, maintain a short list of items banned because of security concerns.

One diplomat said Israel rejected a proposal for cargo to be delivered by ships checked in a third location such as Cyprus.

The flotilla raid has drawn new international attention to the blockade.

Naval commandos landed on the deck of the Turkish ship from helicopters and clashed with pro-Palestinian activists. Eight Turkish citizens and one Turkish-American dual citizen were killed, and dozens of people, including seven soldiers, were wounded.

Israel says the ship was carrying dozens of trained militants who had prepared to confront the soldiers. It has released videos showing the activists attacking the soldiers with clubs, metal pipes and knives.

The activists say they were only defending themselves, and some members of the international community, particularly Turkey, have accused Israel of using excessive force and acting illegally in international waters.

The attack has particularly strained ties with Turkey, which was Israel's closest ally in the Muslim world before.

Turkey swiftly condemned Israel's decision on the inquiry, calling it insufficient and threatening to sever what remains of its already tattered relations with the Jewish state. It expressed dissatisfaction with the makeup of the commission and demanded a neutral international investigation under U.N. auspices.

"If there is no international commission and Turkey's justified demands continue to be ignored, then Turkey of course has the right to review its relations with Israel unilaterally," Turkey's Foreign Minister Ahmet Davutoglu said. "Turkey is the country which lost its citizens."

Israel named the two foreign observers in the investigative commission as David Trimble, a Nobel peace laureate from Northern Ireland, and Canada's former chief military prosecutor, retired Brig. Gen. Ken Watkin. Trimble, a member of the British House of Lords, belongs to a pro-Israel faction in the parliament. Watkin has been a visiting fellow in the human rights program at Harvard Law School.

The participation of Trimble — who, like most Protestants in Northern Ireland, closely identifies with Israel — as well as the limited scope of the inquiry could draw criticism in some corners.

Netanyahu said the commission would not be allowed to interview any soldiers except Israel's military commander. The army is conducting its own inquiry. Instead, it will largely focus on legal issues, such as Israel's position on the Gaza blockade and its decision to take action in international waters.

Netanyahu says he is open to ways to deliver more civilian items to Gaza, but he remains opposed to lifting the blockade altogether.