But the opposition has hit out at a speech from Foreign Minister Penny Wong where she called for a timeline for Palestinian statehood to be declared.
Tensions in the Middle East have threatened to increase after the leader of Hezbollah, Hassan Nasrallah, was killed in Lebanon by an Israeli strike.
Treasurer Jim Chalmers said the death would not be mourned, but emphasis needed to be placed on civilians in Lebanon.
"We do mourn the deaths of innocent victims, and too many innocent lives have been lost already, Â and that's why we need a ceasefire so that the senseless killing of families stop," he told ABC Radio on Monday.
"Our primary concern here is the human cost, but obviously a broader, regional war. The escalation of this very troubling regional conflict will have economic consequences as well."
Following the Israeli strikes, the federal government reiterated calls for Australians in Lebanon to leave the nation.
Setting a timeline for Palestinian statehood sends the wrong message, Simon Birmingham says. (Mick Tsikas/AAP PHOTOS)
Opposition foreign spokesman Simon Birmingham said a broader escalation of the conflict needed to be avoided.
"We should remember always that Hezbollah is a terrorist organisation, that Nasrallah was a terrorist and that he was a terrorist responsible for leading an organisation that had killed many," he told ABC Radio.
Australia, along with other western allies such as the US and UK, released a statement calling for a 21-day ceasefire across the border between Lebanon and Israel.
Senator Birmingham said an outcome needed to be achieved which allowed for people to live safely in border regions.
The opposition spokesman hit out at comments from the foreign minister at the UN which had called for a timeline for Palestinian statehood to be recognised.
"This is very much a case of sending all of the wrong incentives and signals. We don't need an arbitrary timeline for Palestinian statehood," he said.
"We need to see clear clear pre-conditions for Palestinian statehood. An arbitrary timeline essentially gives an incentive to people, and particularly Hamas and others, to run the clock down and towards that timeline to get statehood without releasing hostages."
Hamas - designated by Australia as a terrorist group - attacked Israel on October 7, killing 1200 people and taking more than 200 hostages, according to Israeli authorities.
The attack sparked an Israeli offensive in the Gaza Strip that has killed almost 42,000 Palestinians, according to local health officials.
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