JERUSALEM, Jan 14 (Reuters) - The European Union and Israel have put negotiations over upgrading their ties on hold due to the war in the Gaza Strip, an EU envoy said on Wednesday.

Ramiro Cibrian-Uzal, the EU envoy to Israel, speaking to reporters in Jerusalem, did not say how long the "mutually agreed time-out" in negotiations would last.

"In a war situation, in a situation in which Israel is at war, using its war means in a very dramatic way, in a powerful way in Gaza, everybody realises that it is not the appropriate time to upgrade bilateral relations which normally take place in a more ... peaceful context," Cibrian-Uzal said.

"There is mutual agreement," he said, dismissing any suggestion that this amounted to a "sanction" against Israel over the war. "The European Union has never contemplated, to my knowledge, has never seriously envisaged sanctions."

Officials at Israel's foreign ministry were not immediately available for comment.

The EU agreed last year to upgrade political and trade ties with Israel despite protests by Palestinian officials. But EU envoys note wording in the agreement loosely linking any moves to implement the agreement with progress in peace efforts.

One senior EU diplomat said this week that European leaders would face a public outcry now if they firmed up a tentative plan to meet Israeli leaders at a summit in the coming months.

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