Syria said on Wednesday that military action is needed to solve the worsening situation in the Yarmuk refugee camp, one day after it said it was ready to offer Palestinians its firepower to support their battle with the Islamic State group there.

The deteriorating humanitarian situation in the Palestinian refugee camp has pushed the UN Security Council to demand greater access to residents trapped between the encroaching IS militants and besieging government forces.

The fierce clashes that began on April 1 have ceased, but regime forces continue to drop barrel bombs on the camp, which lies six kilometers from central Damascus.

A military operation is necessary to expel Islamic State jihadists from the camp, Syria's reconciliation minister said on Wednesday.

"The priority now is to expel and defeat militants and terrorists in the camp. Under the present circumstances, a military solution is necessary," minister Ali Haidar said after meeting Palestinian officials.

In the capital, Deputy Foreign Minister Faisal Meqdad met with a delegation from the Palestine Liberation Organization headed by Ahmad Majdalani.

"Syrian authorities are ready to support the Palestinian fighters in a number of ways, including militarily, to push IS out of the camp," said PLO official Anwar Abdul Hadi, who was at the meetings.

Speaking after meeting with Meqdad, Majdalani said they had "agreed on the need for a unified position for the Palestinian forces in Syria, in coordination with the Syrian government".

Most of the Palestinian factions in Yarmuk are opposed to the regime of President Bashar al-Assad, but IS's arrival there sounded alarm bells in Damascus as it is the closest jihadists had ever been to the capital.

Camp residents described a disastrous humanitarian situation.

"I used to call the camp a big prison ... Now, it's different, it's even worse," one, called Samer, told AFP via Skype from inside the camp.

"There was a young man who was killed next to my house by barrel bombs. We picked him up in pieces."

Most of the camp's doctors have already fled, leaving only paramedics to care for the wounded.