Fighting is reported to have ceased in the Suez Canal area after fierce land and air clashes yesterday [July 15] and action by United Nations Truce Supervisor, Lieut.-Gen. Odd Bull. The U.A.R. agreed to observe a cease-fire from 23-00 local last night [July 15]. Clashes had already ceased three hours earlier, Cairo Radio said. The cease-fire was proposed by Gen. Bull following a telephone call from the U.N. Secretary-General U Thant, usually reliable sources here [Cairo] said. The sources said that Gen. Bull told U Thant that the Israelis had requested the cease-fire. U.N. observers began supervising the cease-fire in the Suez Canal area to-day [July 16], faced with the immediate task of trying to establish where the dividing line between Israeli and Egyptian forces runs. Israel has already proposed to Gen. Bull that the cease-fire line should run midway through the 100-mile long waterway, since Israeli and Egyptian forces are in control of the respective two banks. A U.N. spokesman said Israeli shells hit yesterday [July 15] a hotel in Ismailia where the U.N. observers were staying. But none of them seemed to be inside at the time and they were all safe. Israel announced to-day [July 16] that both Israel and Egyptian vessels should be allowed to use the Suez Canal under the cease-fire agreement. The Israeli Government said that it wanted freedom of navigation in the canal after the regular weekly meeting of the Cabinet. The Cabinet Secretary, Mrs. Yael Uzai, told reporters that the Cabinet heard a report from Defence Minister Moshe Dayan on the week-end battles in the Canal area.