US Secretary of State Condoleezza Rice told Palestinian president Mahmud Abbas on Thursday that Israel was ready to discuss "fundamental issues" to advance the stalled Middle East peace.
"The prime minister (Ehud Olmert) said to me that he will support new discussions with you and that he is ready to discuss the fundamental issues that will lead to negotiations soon for the creation of a Palestinian state," Rice told Abbas at a joint press conference in Ramallah.
When asked to elaborate, she said: "I think the word fundamental speaks for itself... I think the desire to move towards a two-state solution seems to be there on both sides."
It was not clear from her remarks, however, whether Olmert had agreed to discuss "core issues" as the Palestinians have been pushing for months -- the thorniest problems of the conflict such as the status of Jerusalem and borders.
Israeli officials had said earlier that Israel wanted to agree a framework on these issues before the international Middle East peace conference that US President George W. Bush has called for later in the year.
"We must reach an agreement with the Palestinians on the framework of the final status issues, which will guarantee a clear diplomatic and security horizon for both sides," a senior Israeli government official quoted Haim Ramon, minister without portfolio, as telling Rice on Thursday.
"This should happen before the summit in November," said Ramon, one of the Olmert's closest allies.
The conference is expected to take place in the autumn after the end of the Jewish and Muslim holidays in mid-October, a senior US official said.
"All negotiations to reach a final agreement must include the principles contained in the international roadmap (for Middle East peace)," Abbas said.
Rice's trip was her first to the Palestinian territories since Hamas seized the Gaza Strip in mid-June and came at the end of a regional tour aimed at building on diplomatic momentum to lay the groundwork for the conference.
The bloody routing of forces loyal to the moderate Abbas from Gaza by the Islamists of Hamas fuelled new diplomatic drives to revive Israeli-Palestinian peace talks, which have been dormant for more than six years.
Following the Gaza takeover, the United States and Israel have been seeking to bolster Abbas in his West Bank powerbase, while isolating Hamas, boycotted by the West as a terror group.
Hamas has slammed the Rice visit as further widening the Palestinian divide.
"Rice didn't come to establish a Palestinian state," spokesman Sami Abu Zuhri said. "She came to support one Palestinian party against another one and to deepen the internal Paleastinian gap."
Abbas and his premier Salam Fayyad were expected to ask Rice to pressure Israel to hand over security control in West Bank cities to boost Abbas in his standoff with Hamas.
But an Israeli government spokesman said on Wednesday: "Israel set the condition that security guarantees must be provided before such transfer of security control."
Rice and Fayyad signed a "framework agreement for security assistance" for more than 80 million dollars Washington has pledged to boost the defence needs of the Palestinians.
The Palestinians were also to ask Rice to push Israel to remove the estimated 500 roadblocks that severely hamper the freedom of movement in the West Bank and are one of the most potent symbols of the four-decade occupation.
Israel opposes removing the roadblocks, saying they are needed in order to prevent militants from launching attacks.
Rice arrived in the region from Saudi Arabia, where she managed to secure a positive response to the conference from the regional Arab heavyweight, which drafted a recently revived 2002 peace plan.
Saudi Arabia does not have diplomatic ties with Israel and has not attended peace talks involving Israel for more than a decade.
US officials said they detected a new sense of hope in the region for the settlement of the Palestinian question, which has dogged Middle East security for decades.
"People do realise that there is an opportunity here and discussions now should take advantage of that and how to maximize the results," one senior US administration official said.
Rice travelled with Defence Secretary Robert Gates to the Middle East, with the pair visiting Egypt and Saudi Arabia together before splitting up: Gates went on to Kuwait, while Rice headed to Israel and the Palestinian territories.
Rice was to return home after her meetings in Ramallah.
