BEIRUT (AFP) - Lebanon is taking stock after a day of deadly street battles in the capital between government and opposition supporters which killed four people and sparked fears of a plunge back into civil strife.

An uneasy calm prevailed in Beirut at the lifting of an overnight curfew imposed to end the intense fighting between rival Sunni and Shiite Muslims in which around 151 people were also wounded.

The riots, at a level not seen since the end of the 1975-1990 civil war, overshadowed a Paris donors' conference which drew pledges of 7.6 billion dollars in aid for Prime Minister Fuad Siniora's beleaguered government.

A few shops and businesses opened when the overnight curfew ended at 6.00am (0400 GMT), but schools and universities remained shut across the nation in line with government orders, AFP correspondents reported.

The roads where the clashes erupted were covered with litter and rubble, while burnt-out cars, buses and large garbage containers lined streets close to Beirut international airport.

During the night, the Lebanese army deployed heavily across the deserted capital, staging patrols and erecting checkpoints on main crossings.

The rioting came two days after the Syrian-backed opposition, led by the Shiite fundamentalist party Hezbollah, brought the country to a near-halt through a general strike which was also marred by widespread deadly clashes.

"Rehearsal for civil war in the streets of Beirut," warned the headline of the al-Balad newspaper.

"Damn the one who awakened it," cried the bold headline of the leftist As Safir newspaper in reference to confessional dissension.

Thursday's clashes first broke out on the main campus of Beirut Arab University but fighting soon penetrated mainly Muslim districts of the capital, both Sunni and Shiite.

Youths threw rocks, set fire to tyres to block traffic, torched cars and smashed windshields amid the rattle of gunshots as troops fired into the air to try to disperse the crowds. There were reports of gunfire and pictures showed masked men holding guns and assault-rifles.

"Confessional riots start street battles in Beirut, and the specter of discord required a curfew and prompted political action," said the headline of the leading An Nahar newspaper.

It however wondered whether the "discord that took place yesterday, and which threatened to become a scary reality in Beirut, would help ease political deadlocks and defuse the crisis because various Lebanese forces feared to have lost complete control over the explosive events."

The riots only ended with calls for calm from leaders of both sides and an army-imposed curfew -- the first such action in the country since violent labour demonstrations in 1996.

The danger of further violence erupting prompted Hezbollah chief Hassan Nasrallah to promptly respond with a call for army orders to be obeyed.

As the Damascus-backed opposition accused the government camp of starting the riots, MP Walid Jumblatt of the parliamentary majority said the fighting was triggered by Syrian President "Bashar al-Assad who is trying to burn Beirut."

"Curfew in Beirut after it was violated by militias attempting a coup," read the headline of the al-Mustaqbal newspaper, owned by the family of MP Saad Hariri, head of the anti-Syrian parliamentary majority.

It accused "Hezbollah and its affiliates of seeking to waste the chance of taking advantage of the international and Arab backing witnessed at the Paris donors' conference."

The opposition is demanding a new national unity government in which it has a veto.

22 killed as Gaza clashes rage

Israel, Livni said, would present its "security needs." She signaled there could be no shortcuts to statehood and called for the terms of a long-stalled U.S.-backed peace "road map" to be met.

Other Israeli officials cited disagreements between Olmert and Rice over the scope of the deliberations.

A senior Israeli official said substantive talks on statehood between Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas would not be on the agenda for now.

"The issues would be security, humanitarian and the political horizon," the official said in a loose reference to a U.S.-backed vision of a Palestinian state alongside a secure Israel.

"Political horizon is not about specifics," the official added, appearing to rule out discussion soon on core issues such as the future of Jerusalem, the borders of a Palestinian state and the fate of Palestinian refugees.

The power-sharing partnership has not met demands by a Quartet of Middle East mediators to recognize Israel, renounce violence and accept existing interim peace accords.

At a news conference postponed from Monday evening after discord with Olmert, Rice said the prime minister and Abbas "have agreed that they plan to meet together bi-weekly."

"We are not yet at final-status negotiations. These are initial discussions to build confidence," Rice said. Her visit ended a day before Arab states open a summit in Riyadh where they intend to relaunch a 2002 plan for peace with Israel.

Olmert told reporters on Monday he would maintain constant contacts with Abbas but did not say how frequently they would meet. The Israeli leader said after the unity government was inaugurated he would limit such talks to humanitarian issues.

His agreement to see Abbas regularly appeared to be a gesture to Washington, which is eager to show the Arab world and European allies it is trying to end the Israeli-Palestinian conflict.

"DIFFERENT MOOD"

Saeb Erekat, a senior adviser to Abbas, said Rice "managed to keep the door open between us and the Israelis which was closing rapidly in the past few days."

A senior U.S. official, briefing reporters on Rice's plane after she left Israel, said he detected a new willingness on the part of Olmert's government to engage Abbas.

"There really was a different mood, a willingness to try and see what this track can produce," said the official, who spoke on condition of anonymity because he was discussing confidential diplomatic exchanges.

Rice said Abbas and Olmert would focus on security issues but also "begin to discuss the development of a political horizon consistent with the establishment of a Palestinian state in accordance with the 'road map."'

The broader Arab League proposal that will be a focus of the Riyadh summit offers Israel normal ties in return for a full withdrawal from land it captured in the 1967 Middle East war.

"Such bold outreach can turn the Arab League's words into the basis of active diplomacy and it can hasten the day when the state called Palestine will take its rightful place in the international community," Rice said.

(Additional reporting by Adam Entous)

WASHINGTON (Reuters) - Israelis and Palestinians could start to explore fundamental peace issues this summer, U.S. officials said, in a sign they believe some progress is possible despite myriad obstacles.

In interviews this week, senior U.S. officials acknowledged the challenge of getting two politically weak leaders -- Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas -- to engage seriously on peace.

Olmert and Abbas plan to meet on Sunday in the first of a series of fortnightly talks that may build confidence and help the two sides, despite their domestic constraints, eventually start to deal with the most intractable issues of borders, the fate of Palestinian refugees and the status of Jerusalem.

Olmert's office on Friday said such "final status" issues would not be on the agenda on Sunday.

"We are not there yet. It could be possible to get to that point within the next few months, by summer," a senior State Department official told Reuters. "I think it has to be an effort by Israelis and Palestinians but also by Arabs too."

The Bush administration has been faulted by Arab diplomats and outside analysts for what critics regard as six years of relative neglect of the Israeli-Palestinian conflict.

SKEPTICISM ABOUT U.S. COMMITMENT

Egypt's ambassador to the United States Nabil Fahmy said progress was necessary soon if Rice wants to allay Arab skepticism about U.S. intentions and commitment.

"As she goes back again and again, there will have to be more meat on the table, not only by way of what the Israelis and the Palestinians do but in what she presents," he told reporters this month.

"It will not suffice to argue that process is an achievement in itself. By early summer, there will have to be ... a deep indication that there is a commitment to dealing with final status issues if not some progress and clarity on the Israeli and Palestinian position on (them)."

There is a widespread belief among foreign policy analysts that the U.S. effort comes at an inauspicious moment.

Olmert was politically weakened by Israel's 34-day war with Lebanon's Hezbollah guerrillas last summer. A government-appointed commission into his handling of the conflict is to release a report later this month.

"Our main concern at the moment is supporting Abu Mazen (Abbas), making sure that Hamas is not in a position to take over -- militarily, economically, politically," said one official.

The official said Washington hopes the roughly $60 million it plans to spend to bolster Abbas' presidential guard and for other security expenses will be multiplied by Arab funds.

He said strengthening the security forces under Abbas and reviving the Palestinian economy "are things that ... lay the basis for a successful negotiation whenever it happens."

One senior official said the administration was realistic about the difficulty of creating a Palestinian state before Bush leaves office.

"We are going to be at this deliberately and methodically. We won't give it up," he said. "We expect to make a contribution in this area. Notice the word expect, not hope."

"It's getting harder and harder," said another official. "I mean, the clock is ticking."

Israeli planes pounded Hamas targets and rival Palestinian factions exchanged bursts of automatic weapons fire outside Gaza City's Islamic University on Friday, as a volatile mix of Israeli strikes and Palestinian infighting plunged Gaza deeper into chaos.

Five Palestinians were killed in a single airstrike by Israel. Israel said the strike was in response to Hamas rocket attacks on southern Israel — a campaign that persisted on Friday with Hamas firing three rockets at the town of Sderot. Three people in the town were injured by shrapnel and several others were treated for shock.

The sound of gunfire and explosions from fighting between Hamas and Fatah rang out for the sixth straight day in Gaza. Outside the Islamic University — a Hamas stronghold — one person was wounded from the exchange of fire, but it was not immediately known from which side.

The fighting largely died down later in the day after Fatah and Hamas fighters took up positions around the university. Earlier, the office of the university's president, Kamelen Shaath, was attacked by rocket-propelled grenades, according to Hamas.

Shaath appealed for an immediate halt to the violence.

"Universities must be outside the circle of violence and I appeal to the president and all the wise people on both sides to try and spare the university the agony of this fight," he said.

In six days of mayhem, 47 Palestinians have died in infighting and another 17 were killed by Israeli strikes. The latest casualty was a 40-year-old Palestinian fisherman named Samir Amodi, who was shot in the head by a sniper in Gaza City's harbor.

Israeli aircraft fired missiles east of Gaza City on Friday, killing five Palestinians, at least three of them Hamas militants, Hamas and local doctors said. Six people were wounded.

The military said the target was a Hamas headquarters building. Three other strikes followed, including an afternoon hit on a Hamas military building near the central Gazan town of Deir al Balah. No casualties were reported, most likely because Hamas had ordered its people to evacuate installations considered targets. But the group's infrastructure suffered further damage.

The intensity of Palestinian street battles has waned since a peak two days ago. But the latest cease-fire was not holding. Shots rang out in many areas, and gunmen who had promised to withdraw from the streets were still manning roadblocks and positions on rooftops.

"Our retaliation for (Fatah's) crimes is going to be beyond their imagination," Abu Obeida, spokesman for Hamas's military wing, told The Associated Press.

Gen. Jamal Kayed, Fatah's security commander in Gaza, said his group had already begun implementing the cease-fire but claimed Hamas was not willing to follow suit.

Walid al-Awad, a member of a committee set up to implement the cease-fire, said his team worked late into the night to get the sides to withdraw, but to no avail.

"Nothing has been implemented, and I have warned both sides that this a time bomb that is sabotaging our efforts," al-Awad said.

The fighting between Hamas and Fatah has all but destroyed their two-month-old power-sharing deal and brought them close to all-out civil war.

By most accounts, Hamas' performance in the latest round of internal fighting has been superior to Fatah's, with greater discipline and more motivated fighters.

Although Israel said it was not taking sides, the airstrikes did make it harder for Hamas gunmen to move around and that could help Fatah's fighters.

Hamas commanders instructed their fighters on walkie-talkies to avoid riding in vehicles, talking on cell phones or gathering in large groups — and to evacuate buildings known by both Israel and Fatah as Hamas hangouts.

The Israeli strikes have introduced a new layer of violence and uncertainty. A senior army official, speaking on condition of anonymity because no official decision has been made, said Israel had no immediate plans for a major ground offensive to halt rocket fire.

There was no sign of any Israeli military buildup that would indicate plans for a serious intervention, though a few tanks and soldiers moved just across the Gaza border on Thursday.

"Israel will take every defensive measure to stop these rocket attacks. We will defend our citizens against the rockets, against the weapons, against the Iranian-backed Hamas who are attacking Israel," government spokeswoman Miri Eisen said.

Analysts said Israeli policy makers were probably trying to walk a fine line to avoid uniting Palestinian factions into a common front against Israel. But Infrastructure Minister Binyamin Ben-Eliezer, a retired general, said Israel could not stand idly by while Palestinian rockets continued.

"We have to show them one thing, that the moment you fire, we shall return fire," he told Israel Radio.

Hamas Web sites, radio and TV carried accusations that forces loyal to Palestinian President Mahmoud Abbas were working with Israel — a charge dismissed as "absurd" by a Fatah spokesman.

On Friday, Hamas TV named three Fatah security chiefs who it said were in secret contact with "foreign" security personnel to exchange information on Palestinian militant groups.

"They are deep into treason, and we will deal with them accordingly," the broadcast said. The TV did not specify which foreigners, but Fatah forces affiliated with Abbas have received advice and training from the U.S.

With his aides citing security concerns, Abbas canceled a Thursday trip to Gaza for talks with Prime Minister Ismail Haniyeh of Hamas.

Israeli Prime Minister Ehud Olmert was under intense public pressure to respond to the Hamas barrage, and he visited Sderot late Thursday.

"I am handling this crisis in order to remove this threat as much as possible," his office quoted him as saying.

Olmert is fighting for political survival in the face of plummeting popularity and harsh criticism of his handling of last summer's war in Lebanon. He probably would be wary of a major ground offensive in Gaza, fearful of another inconclusive effort.

On Friday, Israeli Foreign Minister Tzipi Livni briefed members of the diplomatic corps in Israel on the latest developments and showed them video of a Sderot school damaged by rocket fire.

"For too long the international community took the situation in the south of Israel as acceptable, as part of life in Israel, and it's not," she told Tel-Aviv based envoys. On Thursday, she told German Foreign Minister Frank-Walter Steinmeyer in a phone call that she expects the European Union to apply diplomatic pressure on Palestinians to halt the rocket fire.

Gunmen armed with rifles, grenades and explosives climbed down from rooftop positions Saturday and residents began venturing out of bullet-scarred homes after their leaders agreed to end a week of Palestinian factional bloodshed in Gaza.

The truce began to take hold as Israel launched a fifth day of airstrikes on Hamas targets in the Gaza Strip in reprisal for the Islamic militant group's rocket attacks on Israeli border towns. Other recent cease-fires between the factions have been short-lived but Hamas spokesman Fawzi Barhoum said he expected this one to stick because of Israel's military action.

"No one would accept to fight one another while the Israelis are shelling Gaza," he said.

The clashes between Hamas and Fatah gunmen loyal to Palestinian President Mahmoud Abbas have brought the two groups that nominally share power to the brink of civil war. More than 50 Palestinians have been killed in a week of infighting.

The overlapping violence from Israel's attacks on Hamas rocket operations has killed 23 other Palestinians in the past week.

On Saturday, Israeli Defense Minister Amir Peretz vowed to keep going after Hamas militants who would fire rockets at Israel, warning them to be "very afraid."

Still, Peretz said time was not ripe for a major Israeli ground offensive in Gaza.

An Israeli airstrike killed three people in a car in Gaza early Sunday, Palestinian medics said. Israel said the car was carrying three Hamas radicals and a load of weapons. The Israeli army also said warplanes demolished arms factories belonging to Hamas and — for the first time since the airstrikes began on Tuesday — Islamic Jihad, a smaller militant group that has also been involved in rocket attacks on Israel.

On Saturday, four Palestinians were killed in air attacks on Hamas targets, while five rockets from Gaza hit the Israeli border area, causing damage, but no injury.

The Israeli air attacks, backed by tank fire, have driven Hamas fighters out of their bases, prompting the militant group to accuse Israel and Fatah of colluding against it.

The Palestinian infighting broke out Sunday after Abbas stationed thousands of security forces on the streets of lawless Gaza City — a move Hamas interpreted as a provocation because it wasn't consulted.

Saturday's truce committed the battling factions to pull their fighters off the streets and exchange an unknown number of hostages.

Four previous cease-fire agreements collapsed earlier in the week.

A gunbattle erupted outside the home of a senior Fatah official in Gaza City as the cease-fire was reached, and security officials said several people were wounded.

And in another sign of the shaky nature of the truce, several hostages from both factions were released before an official exchange ceremony — but only after their captors shot them in the legs, both sides said.

Still, as word of the cease-fire spread, and enforcement teams went out on the streets, fighters began to comply — something they had not done with the previous truces. They also began knocking down roadblocks they had set up to identify rival fighters.

Truce enforcers from various Palestinian factions went from rooftop to rooftop, urging gunmen to leave. At one Gaza City building that had been the site of fierce fighting, Hamas fighters climbed down carrying a cache of rocket-propelled grenades, bags of explosives and AK-47 rifles.

Mervat, a resident who would only give her first name for fear of reprisal, said the fighting terrorized her 5-year old daughter who thought the conflict was with Israelis. The two never left home throughout the fighting.

"Hopefully it will stick this time. We are the only losers if this continues," she said.

She and other residents who had remained holed up at home throughout the fighting stepped out hesitantly to shop for groceries and other supplies.

Ribhi Barghouti held up a fistful of burnt American dollars. He said mortars fell in his apartment, destroying his furniture and burning up his wife's passport and $13,000 the couple had stashed away.

"I lost everything. ... It is impossible to tell what will happen in this place anymore," he said. He said he plans to return to his native West Bank as soon as his wife replaces her ID.

Some Gazans returned to their apartments, passing evacuating fighters on the way, only to decide the damage was too great for them to stay. They stuffed a few belongings into suitcases and left again.

The hostage handover — a major element of the cease-fire deal — was delayed for hours while kidnapped men were located. Shortly after midnight Saturday, two buses carrying kidnapped men from both sides pulled up to the Egyptian representative office in Gaza City, where the cease-fire was negotiated.

Col. Burhan Hamad, head of an Egyptian security team that helped to mediate the cease-fire, said 30 hostages were to be released early Sunday, and the remaining 18 later in the day.

The truce accord was endorsed by Abbas and Hamas' exiled supreme leader, Khaled Mashaal, who conferred a rare three times by phone in the past few days. Mashaal lives in Syria.

"Both leaders ... made their calculations and realized that they can't gain this way," Palestinian Information Minister Mustafa Barghouti said.

Barghouti also said Saudi Arabia "made it clear they can't accept the failure" of the agreement Hamas and Fatah reached in Mecca in February to form a national unity government.

The bloodshed in Gaza threatens to deter Arab countries from giving badly needed economic aid to Palestinians, said Peter Ford, the top fundraiser for the U.N. Relief and Works Agency.

Ford, speaking to participants at the World Economic Forum meeting in Jordan, said he was most concerned that UNRWA had to cut its job creation program in the Palestinian territories.

"Gaza needs that like a hole in the head," Ford said. "This is a result of us not being given enough funds for our emergency program to create jobs."

The violence with Israel, meanwhile, has destroyed a cease-fire Gaza militants reached with Israel nearly six months ago.

Israel launched its latest round of airstrikes on Hamas targets on Tuesday. The militant group, which refuses to recognize Israel's right to exist, has fired nearly 120 rockets at southern Israel since Tuesday, the military said, including three that landed early Sunday, the army said. One of the three hit an empty home.

Rocket squads should be "very afraid," because "it is our intention to act against Hamas," Peretz vowed in an interview with Israel Radio.

Asked whether Palestinian Prime Minister Ismail Haniyeh of Hamas and the head of Hamas' military wing, Ahmed Jaberi, could also be targets, Peretz said he would not rule out any action that "makes it clear to everyone that we don't intend to allow anyone to harm Israeli citizens."

At the same time, he said Israel would not embark on a major offensive in the Gaza Strip because it had other, unspecified tools in its arsenal to use against rocket-launchers, he said.

Peretz insisted Israel is not interfering in the internal Palestinian fighting. However, he said "we certainly would like the moderate forces to emerge with the upper hand," a reference to Fatah.

___

Associated Press Writer Dale Gavlak contributed to this story from Southern Shuneh, Jordan.

Lebanese troops pounded a Palestinian refugee camp with artillery and tank fire for a second day Monday, raising huge columns of smoke as they battled a militant group suspected of ties to al-Qaida in the worst violence since the end of the 1975-90 civil war.

Nearly 50 combatants were killed in the first day of fighting Sunday, but it was not known how many civilians have been killed inside the Nahr el-Bared camp on the outskirts of the northern port city of Tripoli.

Palestinian officials in the camp reported at least nine civilians were killed Monday, along with 40 wounded. The figures could not be confirmed because emergency workers or security officials have not been able to get in.

The White House said it supports Lebanese Prime Minister Fuad Saniora's efforts to deal with fighting, and the State Department defended the Lebanese army, saying it was working in a "legitimate manner" against "provocations by violent extremists" operating in the camp.

Black smoke filled the sky over Nahr el-Bared as fires raged for hours and heavy gunfire and explosions rang out constantly. Shells could be seen thudding into buildings in the seaside camp.

Fighting paused briefly in the afternoon to allow the evacuation of 18 wounded civilians, according to Saleh Badran of the Palestinian Red Crescent Society. But the fighting quickly resumed. Ambulances raced through the streets of nearby Tripoli, where many shops were closed and many residents stayed inside.

"There are many wounded. We're under siege. There is a shortage of bread, medicine and electricity. There are children under the rubble," Sana Abu Faraj, a refugee, told Al-Jazeera television by cell phone from the camp.

Late Monday, residents reported an explosion in a Muslim neighborhood of Beirut, the capital. The Future TV station said the blast occurred in the Verdun shopping area, while Hezbollah's Al-Manar television said it took place in a parking lot in the posh district. Television footage showed a burning car and at least one injured man. On Sunday night, a bomb near a mall in the Christian sector of the capital killed a woman and wounded 12 other people.

Lebanon was already in the midst of its worst political crisis between the Western-backed government and Hezbollah-led opposition since the end of the civil war.

The battle was an unprecedented showdown between the Lebanese army and militant groups that have arisen in Lebanon's Palestinian refugee camps, which are home to tens of thousands of people living amid poverty and crime and which Lebanese troops are not allowed to enter.

The troops were fighting a group called Fatah Islam, whose leader has said he is inspired by al-Qaida leader Osama bin Laden and was training militants for attacks in other countries. Lebanese officials have also accused Syria of using Fatah Islam to stir up trouble in Lebanon, a charge Damascus has denied.

Lebanese officials said one of the men killed Sunday was a suspect in a failed German train bombing — another indication the camp had become a refuge for Fatah Islam militants planning attacks outside of Lebanon. In the past, others affiliated with the group in the camp have said they were aiming to send trained fighters into Iraq and the group's leader has been linked to al-Qaida in Iraq.

Hundreds of Lebanese troops, backed by tanks and armored carriers, surrounded the refugee camp Monday. M-48 battle tanks unleashed their cannon fire on the camp, home to 30,000 Palestinian refugees. The militants fired mortars toward the troops at daybreak.

An army officer at the front line said troops directed concentrated fire at buildings known to house militants. He said troops also had orders to strike hard at any target that returned fire.

"Everything we know that they were present in has been targeted," he told The Associated Press, speaking on condition of anonymity because he was not authorized to talk to the media.

A spokesman for Fatah Islam, Abu Salim, warned that if the army bombardment did not stop, the militants would step up attacks by rockets and artillery "and would take the battle outside Tripoli."

He did not elaborate.

"It is a life-or-death battle. Their aim is to wipe out Fatah Islam. We will respond and we know how to respond," he told the AP.

Earlier in the day, another refugee camp, Ein el-Hilweh in southern Lebanon, was tense after Lebanese troops surrounded it and armed militants went on alert.

At least 27 soldiers and 20 militants were killed Sunday, Lebanese security officials said. But they did not know how many civilians had been killed in the camp because it is off-limits to their authority.

Lebanon says it has no authority to enter the camps under understandings with the Palestinians that give the PLO the authority in the camps. But Lebanon also is believed to be leery of entering for fear that any such actions would cause widespread unrest, be very costly and could spark pan-Arab sympathy for the Palestinian refugees that would trigger a backlash against the country.

The clashes were triggered Sunday when police raided suspected Fatah Islam hideouts in several buildings in Tripoli, searching for men wanted in a recent bank robbery. A gunbattle erupted at one of the buildings between the group's fighters, and troops were called in to help the police.

Militants then burst out of the nearby refugee camp, seizing Lebanese army positions, capturing two armored vehicles and ambushing troops. Lebanese troops later laid siege to the camp, where Fatah Islam militants were believed to be hiding.

Fatah Islam is led by a Palestinian named Shaker al-Absi, who is wanted in three countries. He is believed to have fought in Afghanistan and Iraq. He told The New York Times in March that he was trying to spread al-Qaida's ideology and was training fighters inside the camp for attacks on other countries.

He would not specify which countries but expressed anger toward the United States. And he was sentenced to death earlier in absentia along with Abu Musab al-Zarqawi, the leader of al-Qaida in Iraq killed last summer by U.S. forces in Iraq, for the 2002 assassination of an American diplomat in Jordan.

In a news conference in March, al-Absi denied he was sending fighters to Iraq.

"Fighting in our homeland (Palestine) is more important," he said then. "We have no connection with any regime or organization on this earth. Our connection is with 'There is no God but God' (the slogan of Islam). We have come to raise it over the skies of Jerusalem."

Al-Absi had been in custody in Syria until last fall but was released and set up his group in the camp, where he apparently found recruits, Lebanese officials said.

Lebanon's national police commander, Maj. Gen. Ashraf Rifi, said Damascus was using Fatah Islam as a covert way to wreak havoc in the country. He denied Fatah Islam's al-Qaida links, saying it was a Syrian-bred group.

"Perhaps there are some deluded people among them but they are not al-Qaida. This is imitation al-Qaida, a 'Made in Syria' one," he told the AP.

Lebanese security officials said Fatah Islam has up to 100 members who come from Arab countries, including Saudi Arabia and Syria, as well as local sympathizers who belong to the conservative Salafi branch of Islam.

The Lebanese Broadcasting Corp. TV station reported the dead militants included men from Bangladesh, Yemen and other Arab countries. Some wore explosive belts, security officials said.

Officials identified the suspect in the failed German train bombing as Saddam El-Hajdib, the fourth-highest ranking official in the Fatah Islam group, an official said. The official spoke on condition of anonymity because he was not authorized to speak to the media. El-Hajdib had been on trial in absentia in Lebanon in the failed German plot.

It was unclear whether Lebanese authorities had known the whereabouts of El-Hajdib or al-Absi before the gunbattle first broke Sunday out in Tripoli.

White House deputy press secretary Tony Fratto said the Bush administration is concerned about the fighting. "We believe the parties should take a step back from violence," he said.

The State Department gave its support to the Lebanese army's battle with Fatah Islam.

"This is a group that has been involved in violence to achieve whatever their stated objective may be," spokesman Sean McCormack said.

McCormack declined to discuss whether the group may be tied to al-Qaida or other groups outside Lebanon. Asked about a possible Syrian link, McCormack said, "At this point I wouldn't draw that connection."

In Monday's fighting, a driver for the AP, working with journalists at the scene, was injured when he was hit in the thigh by a bullet or shrapnel. He was being treated at a hospital and was expected to recover.

Ahmed Methqal, a Muslim cleric in the camp, told Al-Jazeera that five civilians had been killed.

"You can say there is a massacre going on in the camp of children and women who have nothing to do with Fatah Islam," he said. "They are targeting buildings, with people in them."

Lebanon has struggled to defeat armed groups that control pockets of the country — especially inside the 12 Palestinian refugee camps housing 350,000 people.

Some camps have become havens for Islamic militants accused of carrying out attacks in the country and of sending recruits to fight U.S.-led coalition forces in Iraq.

Palestinian officials from the moderate Fatah faction in the West Bank sought to distance themselves from Fatah Islam and urged Palestinian refugees in the camp to isolate the militant group.

Khaled Mashaal, exiled political leader of the Palestinian militant group Hamas, asked Saniora to take "necessary procedures" to ensure refugees in the camp are not harmed.

___

Associated Press Writer Hussein Dakroub in Beirut contributed.

On its first day of full rule in Gaza, the Islamic militant Hamas on Friday granted amnesty to Fatah leaders, signaling that it seeks conciliation with the defeated forces of moderate Palestinian President Mahmoud Abbas.

Many had feared more bloodshed, particularly after victorious Hamas gunmen executed several Fatah fighters in the streets gangland-style on Thursday, in the final phase of the decisive five-day battle over Gaza.

Gazans awoke to the new reality of Hamas control Friday, fraught with uncertainty and fear that they'll become even poorer and more isolated. Gaza's crossings with Egypt and Israel — lifelines for the fenced-in territory — have been closed this week, and it was not clear if they would reopen. Extended closure could quickly lead to a humanitarian crisis.

A Hamas spokesman said Palestinian police, now under Hamas command, would take up positions at the crossings, but it's unlikely Israel would acquiesce to such a deployment, after Hamas militants frequently attacked the passages in the past.

The Palestinian territories are in effect split in two. Gaza is now controlled by Hamas, which has close ties to Syria and Iran. The more populous West Bank, with about 2 million residents to Gaza's 1.4 million, is dominated by the more moderate Fatah, which has ties to Israel and the West.

Gaza's streets, deserted in the past week, were crowded with cars, pedestrians and triumphant Hamas fighters, some driving in jeeps and firing in the air. Crowds converged on former Fatah strongholds and looted them.

A resident of a Hamas-dominated neighborhood, identifying himself only as Yousef for fear of reprisal by his neighbors, said Gazans would always back the winner, regardless of ideology.

"Today everybody is with Hamas because Hamas won the battle. If Fatah had won the battle they'd be with Fatah. We are a hungry people, we are with whoever gives us a bag of flour and a food coupon," said Yousef, 30. "Me, I'm with God and a bag of flour."

The house of former Gaza strongman Mohammed Dahlan of Fatah was overrun, and looters stripped it of everything from windows and doors to flowerpots. "This was the house of the murderer Dahlan that was cleansed by the holy warriors," read graffiti sprayed on the wall. Donkey carts outside the house waited to take on more loot.

Because Fatah recognizes Israel and past peace agreements, a boycott of the Palestinian government imposed by Israel and the international community after Hamas' electoral successes may no longer apply to the West Bank — only Gaza.

Abbas named his own prime minister — Salam Fayyad, an independent who is well-respected by the international community.

Gaza City's main Shifa Hospital was still grappling with the aftermath of battle. More than 90 people were killed in five days of fighting, and dozens wounded. The morgue was overflowing, with four bodies lined up on the floor, and some of the wounded were sleeping on cardboard on the floor, instead of mattresses or beds.

The buildings that symbolized Fatah's power, the National Security headquarters, Abbas' residence, were guarded by Hamas men. Outside Abbas' residence, a boy draped a green Hamas flag over a low wall as a Hamas guard looked on smiling.

Earlier Friday, Hamas announced it had arrested 10 of the most senior Fatah leaders in the strip, including the commanders of Abbas' own elite guard unit and the chief of the National Security force. However, Hamas spokesman Abu Obeideh later declared an amnesty for all Fatah leaders, and several Fatah leaders, including spokesman Tawfiq Abu Khoussa, were released shortly afterwards.

Abu Obeideh said his group will "offer amnesty" to all those who are with different opinions. "Our battle is not with Fatah ... but with the group that tried to implement an external agenda," he said.

However, Hamas also said that a Fatah supporter was thrown to his death by the family of a man he was accused of having killed earlier. Elsewhere, a senior Fatah official committed suicide after learning he was on Hamas' wanted list, Fatah said.

Abu Obeideh also called for the immediate release of Alan Johnston, the BBC journalist who was kidnapped in March and is believed held by a powerful Gaza clan whose members had ties to both Hamas and Fatah. "We will not allow for his continued detention," Abu Obeideh said of Johnston.

The battle for Gaza ended Thursday night when Hamas forces took the last Fatah stronghold, the seaside office complex of Abbas. The Fatah forces had collapsed quickly under Hamas' systematic onslaught. One by one, Hamas seized Fatah's security installations and marched once-feared Fatah fighters down the street shirtless and with hands raised.

From his office in the West Bank town of Ramallah, Abbas declared a state of emergency Thursday, firing the Hamas-led government and its prime minister, Ismail Haniyeh.

Haniyeh brushed off Abbas' decision, calling it "hasty" and refusing to leave office. He said Friday the Islamic organization was still committed to unity agreements it signed with Fatah.

The European Union offered its support for Abbas, and EU External Relations Commissioner Benita Ferrero-Waldner called him "the legitimate president of all Palestinians."

Fearful that Hamas' momentum could spread to the West Bank, Fatah-allied forces staged a show of force. Palestinian security forces, some wearing black ski masks, drove through Ramallah in pickup trucks, rifles raised.

In the city of Nablus, Fatah men shot dead a Hamas member early Friday, Hamas said, the first to be killed in the West Bank. The Al Aqsa Martyrs' Brigades, a violent Fatah offshoot, claimed responsibility. On Thursday, angry Fatah militants trashed an office of Hamas lawmakers in Nablus.

But in Gaza, Thursday was a day of triumph for Hamas and its backers in Iran and Syria — and of devastation for Fatah.

No battle was more indicative of Gaza's hatreds and passions than the one at Preventive Security headquarters, one of Fatah's four main security bases in the strip.

Preventive Security carried out a brutal crackdown on Hamas in 1996, and the militants never forgot it. Witnesses, Fatah officials and a doctor reported gangland-style killings of the defeated fighters Thursday.

Fatah officials, speaking on condition of anonymity for fear of retribution, said Hamas shot dead seven Fatah fighters after they had surrendered. A doctor at Shifa Hospital said he examined two bodies that had been shot in the head at close range. Hamas denied it carried out executions.

The stage for the struggle between Fatah and Hamas was set last year, when Hamas won parliamentary elections. Hamas reluctantly brought Fatah into a coalition government in March to quell an earlier round of violence, but the uneasy partnership began crumbling last month over control of security forces.

Hundreds of Fatah supporters fled the Hamas-controlled Gaza Strip by land and sea on Saturday and the Islamist group threatened to take its fight against Palestinian President Mahmoud Abbas's forces to the West Bank.

Abbas, who leads the secular Fatah faction, is set to swear in an emergency government on Sunday at 1 p.m. (1000 GMT) that will bring an end to a U.S.-led aid embargo.

Prime Minister-designate Salam Fayyad has selected 14 ministers to serve in his cabinet, officials said. Hamas says the cabinet's appointment amounts to a coup.

Abbas sacked a Hamas-led unity government after Islamist forces routed Fatah in the Gaza Strip and began imposing a new order and making key security appointments.

Hamas official Sami Abu Zuhri said 150 Hamas supporters were "abducted" in the occupied West Bank in what he called acts of "real terrorism" by Fatah forces there. "We will not stand handcuffed against these crimes in the West Bank. We will take all steps to secure an end to these crimes," he said.

The U.S. consul-general who handles relations with the Palestinians said Washington would lift a ban on direct financial aid to the new emergency government, clearing the way for the European Union and Israel to follow suit.

"There won't be any obstacles economically and politically in terms of re-engaging with this government ... They will have full support," Jacob Walles told Reuters after meeting Abbas at his West Bank headquarters in Ramallah, near Jerusalem.

The Quartet of Middle East peace mediators -- the United States, the European Union, Russia and the United Nations -- voiced support for Abbas and concern about humanitarian conditions in Gaza, but did not say whether it would ease its ban on direct aid to an Abbas-controlled Palestinian Authority.

Gaza and the much larger West Bank are only about 45 km (30 miles) apart, with Israel in between, but they now appear poised to function as two separate territories.

"Gaza, unfortunately at this stage, is out of the control of the Palestinian Authority," Abbas aide Saeb Erekat said.

Hamas said it did not seek its own state in Gaza, where 1.5 million people are crowded along 40 km (25 miles) of coast.

Western powers imposed an aid embargo after Hamas came to power in March 2006 because it failed to recognize Israel, renounce violence and accept interim peace deals.

Hamas set up checkpoints in Gaza to prevent high-ranking Fatah officials from leaving the coastal enclave.

Palestinian officials said hundreds of Fatah supporters were allowed by Israel and Egypt to travel to the West Bank.

An Israeli army spokeswoman said Israel had allowed people to leave Gaza for the West Bank on a case-by-case basis but the border was later closed.

"I will not live in a Hamas-run state," said Shadi, a fighter from Abbas's Fatah faction, after escaping Gaza for the occupied West Bank through an Israeli crossing point.

WEST BANK TROUBLE

About 50 Fatah gunmen and 200 other demonstrators stormed a Palestinian parliament building in Ramallah. The militants grabbed the deputy speaker, who is aligned with Hamas, and dragged him from the building, witnesses said. He was not hurt.

In Hebron, another West Bank city, militants of al Aqsa Martyrs Brigades, an offshoot of Fatah, stormed government offices and set up checkpoints to search for Hamas members.

Many Fatah supporters in Gaza fear reprisals from Hamas. "We were destroyed ... I feel lost," said Umm Rami, whose husband is a colonel in the Fatah-dominated National Security Forces.

Fayyad, a Western-backed technocrat and former finance minister, finalized the formation of the new government and will unveil the line-up on Sunday, Abbas aide Yasser Abed Rabbo said.

Ismail Haniyeh, who became prime minister after Hamas won the 2006 parliamentary election, refuses to accept his dismissal.

In an interview with a French newspaper, he ruled out setting up a Palestinian state in the Gaza Strip. "Separation is not on the agenda and never will be," Haniyeh said.

Palestinian police chief Kamal el-Sheikh, who is based in the West Bank, ordered his men in Gaza not to work or obey Hamas orders. Haniyeh responded by appointing what he called a "higher police command" above el-Sheikh.

Under Palestinian law, Abbas can declare a state of emergency for up to 30 days. This could be extended for another 30 days, but only with the approval of two thirds of parliament.

Hamas has a majority in the parliament although Israel's arrests of nearly half of Hamas's deputies put that majority in doubt and also made it hard to achieve a quorum. That could enable Abbas to keep the state of emergency in place longer.

(Additional reporting by Wafa Amr in Ramallah and Ori Lewis in Jerusalem)

Mahmoud Abbas got a major boost in his increasingly bellicose showdown with Hamas on Saturday, with a U.S. diplomat saying he expects a crippling embargo to be lifted once the Palestinian president appoints a government without the Islamic militants.

But the money is unlikely to reach Gaza, now controlled by Hamas and cut off from the world.

The new Cabinet is to be sworn in Sunday in the West Bank, where Fatah forces stormed government offices on Saturday, just three days after Hamas seized control of Gaza and Abbas dismantled the Hamas-Fatah coalition government in response.

In Gaza, panicked residents stocked up, fearing growing shortages of food, fuel and other staples as the crossings of the fenced-in strip with Israel and Egypt remained closed. Hundreds of other Gazans rushed to the border crossing with Israel to try to escape Hamas rule, but found gates locked. Israeli troops briefly fired warning shots.

Senior officials of Abbas' Fatah movement, who had fled Gaza, started reaching the West Bank. The head of Palestine TV said he had crawled for several hundred yards to evade gunfire at the Gaza-Israel crossing before making it to safety.

"Hamas has always targeted me. Once they fired shots are my car. And they wrote on their Web site that I am broadcasting sedition," said Abdel Salam Abu Nada. Recently, he received an ominous text message on his cellphone saying, "Your punishment is coming."

Across Gaza, Hamas cemented control. Prime Minister Ismail Haniyeh, who has ignored Abbas' order firing him, replaced Fatah security commanders with his own men, and Hamas gunmen rounded up their opponents' weapons. In the southern town of Khan Younis, members of the most powerful local clan refused to hand over their guns, and a firefight erupted. Hamas fighters stormed the homes of clan members, saying they confiscated drugs and a weapons cache.

Two Fatah loyalists were killed Saturday, in what Fatah alleged were revenge killings. Also, the bodies of seven Hamas members were found in the basement of the Preventive Security Service headquarters, a Fatah stronghold captured Thursday, and the bullet-riddled corpse of a Fatah field commander turned up in southern Gaza. More than 100 people were killed a week of clashes.

In the West Bank, gunmen from Abbas' Fatah movement attacked Hamas-run institutions, taking control of the parliament and several government ministries. Chanting "Hamas Out," they planted Fatah and Palestinian flags on rooftops. They attacked Deputy Parliament Speaker Hassan Kreisheh, an independent, and left only after warning that government workers with Hamas ties could not return.

In Gaza, Deputy Parliament Speaker Ahmed Bahar of Hamas called Abbas' attempt to form an emergency government illegal.

Abbas, meanwhile, angrily rejected attempts by Arab League chief Amr Moussa to mediate between him and Hamas' supreme leader, Khaled Mashaal. Abbas aide Yasser Abed Rabbo said the president would not engage in a dialogue with "killers."

In the showdown, much of the international community, including the U.S., the European Union and moderate Arab states, is backing Abbas. Declarations of support were likely to be followed soon by a resumption of foreign aid to the Palestinian Authority.

It is not clear yet whether the international funds would reach Gaza, since it was the Hamas victory in legislative elections that led to the embargo 15 months ago.

The U.S. consul general in Jerusalem, Jacob Walles, met with Abbas at his headquarters in Ramallah on Saturday, and said the embargo is expected to be lifted once the new government is sworn in.

"I expect that we are going to be engaged with this government," Walles said after the meeting. "I expect that early next week. There will be some announcements in Washington, specifically about our assistance and about the financial regulations."

The boycott, which has crippled the Palestinian economy, continued even after Fatah joined Hamas in a coalition in March.

Hamas has not explained how it would run Gaza without foreign support or contact with the outside world. Israel controls Gaza's borders, wielding tremendous influence over the movement of people and goods in and out of the area.

On Saturday, there were signs of panic. One Gaza City baker distributed tickets to those lined up for bread. Sarifa Hadad, a mother of seven, bought $40 worth of food, including tomato paste and shortening, and was going from store to store to buy more. "They say the borders are going to be closed, so we are searching for sugar and supplies," she said.

Israel will eventually allow basic supplies into Gaza to prevent a humanitarian disaster, said Public Security Minister Avi Dichter. However, he said Israel would consider Gaza a "terrorist entity" and try to cut off its weapons supply. He said this might require an Israeli deployment along Gaza's border with Egypt, to halt smuggling.

Israel withdrew from Gaza in 2005, ending a 38-year-old military occupation.

Dozens of Gazans, meanwhile, converged on Gaza's Erez crossing with Israel in hopes of fleeing. One man was carried on top of a luggage trolley with his leg bandaged. Hassan, 21, a presidential guard trainee, said he was shot in the fighting. He gave only his first name because he was afraid of retribution.

About 150 waited at the gate separating Gaza from Israel. Some carried large suitcases, others held tiny plastic bags. One young man shouted "bye, bye, Gaza," and waved as he walked through the covered walkway that leads to the Israeli side.

Symbols of Fatah control, including the Gaza City residence of the late Yasser Arafat were looted. Abbas' office said looters took furniture, including a bed, as well as presents the legendary leader had received in four decades at the helm of Palestinian politics. Hamas security forces later arrived and locked the house. Hamas denied anyone had broken into the building.

In his new job as Mideast envoy, Tony Blair will take on a task that has bedeviled many before him — a role complicated by Hamas' takeover of Gaza, the weakness of Palestinian and Israeli leaders, and animosity deepened on both sides by six years of conflict.

Still, the outgoing British prime minister brings new credibility to international efforts to forge peace in the region, and Israeli and Palestinian officials welcomed reports Tuesday that he will represent the Quartet of Mideast mediators — the U.S., U.N., European Union and Russia.

The official announcement of the Quartet's decision was to be made Wednesday, a senior U.S. official said. The official, who insisted on anonymity because the statements were still being drafted, spoke after being briefed on a meeting of Quartet representatives in Jerusalem.

Blair's appointment is the latest step in a burst of diplomacy following the seizure of the Gaza Strip by the Islamic militants of Hamas, adding a high-profile world leader to efforts to bolster Palestinian President Mahmoud Abbas and restart Israel-Palestinian peace talks.

Brokering peace in Northern Ireland — ending decades of violence that claimed more than 3,500 lives_ is counted as one of Blair's most significant diplomatic achievements. He has also pressed for agreements on climate change and combating poverty in Africa.

The personable Blair is viewed as a masterful communicator, an attribute both praised and pilloried, with some critics suggesting he is style over substance. But he has the knack for knowing what to say: When Princess Diana died in a Paris car crash, he stepped before TV cameras and dubbed her the "People's Princess," capturing the mood of a mournful Britain.

Blair's new job will deal primarily with helping the Palestinian Authority build political institutions. It won't, at least at first, involve direct mediation or negotiation between Palestinians and Israelis, the senior U.S. official said.

But Blair is one of the rare world leaders who is considered a friend by both the Israeli and Palestinian governments.

Israelis see him as one of the most supportive leaders on the world stage, standing by the Jewish state through years of crises and spasms of violence as other leaders piled on criticism.

While noting that the appointment was not official, Israeli Foreign Minister Tzipi Livni said Tuesday that "Tony Blair is a very well appreciated figure in Israel."

Israel Prime Minister Ehud Olmert spoke with Blair on Tuesday evening, calling him "a true friend" of Israel and promising full cooperation if he accepted the job as Quartet envoy, the prime minister's office said in a statement.

Many Palestinians, too, consider Blair a friendly world figure despite his close ties to the U.S. and his role in the war in Iraq.

The British leader has a long history of support for the Palestinian cause, had good relations with the late Yasser Arafat and was one of the first Western leaders to endorse the "two-state solution," a Palestinian state living in peace next to Israel.

Fahmi al-Zaarer, a spokesman for Abbas' Fatah movement, said Palestinians would welcome Blair. "We believe that Mr. Blair's efforts would help ... revive the political process," he said.

Palestinian Prime Minister Salam Fayyad said: "We hope this appointment will speed efforts to resume the political process to achieve the establishment of a Palestinian state with east Jerusalem as its capital."

The European Union's Mideast envoy, Marc Otte, told reporters Tuesday night in Jerusalem that Blair would bring "added value" to Mideast peacemaking. He cited Blair's "power to move people at high levels, the ability to talk to leaders in the region and outside of the region."

Despite such optimism, other notables, including President Bush and former President Clinton, have suffered frustrations in lending their reputations to peace efforts in the region. And a series of U.S. envoys has left in despair as Palestinian-Israeli violence escalated.

Peace negotiations broke down in the final days of Clinton's presidency despite his monumental effort to reach agreement between Israel and the Palestinians.

Bush invested his prestige in an internationally backed peace plan known as the "road map," but it failed to bear fruit after Palestinians and Israelis failed to implement its initial requirements.

Blair faces an even bleaker situation.

Hamas, which is sworn to seek Israel's destruction, controls Gaza. Abbas, never perceived as a strong leader, is in an increasingly weak position, his rule confined to the West Bank. Olmert is fighting for his political life after losing most popular support because of Israel's inconclusive war with Hezbollah guerrillas in Lebanon last summer.

Israeli analyst Yossi Alpher said he expects little from the Blair appointment. "There is no peace process, and there isn't likely to be a peace process in the near future for Blair to work on," Alpher said. "I predict that he will quit in frustration in a year and a half."

Blair's predecessor as Quartet envoy, former World Bank head James Wolfensohn, resigned in exasperation after less than a year in the post. Little came of his efforts to bring Israelis and Palestinians together after Israel's 2005 withdrawal from Gaza, which was followed by rising violence and a Hamas victory in parliamentary elections.

Talking to reporters after meetings in Paris, Secretary of State Condoleezza Rice all but confirmed Blair's appointment Tuesday. Asked if he was getting the post, she responded with a smile and said: "Stay tuned."

She added that it was important to strengthen the Palestinian side so it can bargain with Israel in eventual peace talks.

"Working with Palestinian institutions to get them ready for statehood is just extremely important," she said. "You hear a lot of people say, 'Well, where's the Palestinian partner?' This is an effort to develop the Palestinian partner."

Olmert met with Abbas and the leaders of Egypt and Jordan on Monday in a gesture of support for the Palestinian president.

Trying to build on the momentum of those and other recent diplomatic efforts, representatives of the Quartet met for nearly three hours Tuesday at the U.S. Consulate in west Jerusalem. It was the group's first talks since Hamas took over Gaza.

Speaking to reporters later in the West Bank town of Ramallah, Assistant Secretary of State David Welch said only that the meeting "went well."

___

Associated Press writers Anne Gearan and Matthew Lee in Washington contributed to this report.

Scores of Fatah militants in the West Bank have signed a pledge renouncing attacks against Israel in return for an Israeli promise to stop pursuing them, a Palestinian security official said Sunday.

The deal would grant amnesty to 178 Fatah gunmen who will join the official Palestinian security forces, and Israel will remove them from its lists of wanted militants, the official said. He spoke on condition of anonymity because he was not authorized to divulge details of the agreement.

An official in Israeli Prime Minister Ehud Olmert's office confirmed the deal would extend to wanted militants who openly renounce terrorism, and was part of a series of measures to bolster Palestinian President Mahmoud Abbas.

The moderate president set up a Fatah-led government in the West Bank after his rivals from the Islamic group Hamas seized control of the Gaza Strip in mid-June. Israel and the international community back Abbas in his struggle against Hamas.

Olmert will meet Abbas on Monday, Olmert's office said, in the first meeting between the two leaders since a June 25 summit that followed the Hamas victory in Gaza. At the meeting, Olmert is expected to present a list of 250 Fatah prisoners Israel will release.

And in another gesture of support, Israel agreed to Abbas' request to allow Nayef Hawatmeh, an exiled Palestinian militant leader, to enter the West Bank this week for a meeting of a top Palestine Liberation Organization policy-making body, a step that Abbas hopes will provide him added legitimacy among Palestinians.

Hawatmeh heads the Democratic Front for the Liberation of Palestine, a small and nearly forgotten PLO faction best known for commandeering a school in the northern Israeli town of Maalot in 1974. The attack left 24 Israelis dead, most of them children, and helped shaped the attitudes of a generation of Israelis about the Palestinian leadership.

The amnesty document began circulating Saturday among members of Fatah-allied militia groups dedicated to fighting Israel.

The Palestinian official said an "overwhelming majority" of the militants have already signed. The Palestinians asked that another 200 militants be included in the amnesty, he said.

An Arabic text of the document obtained by The Associated Press reads in part: "The Israeli security and judicial authorities will refrain from arresting or pursuing me after I sign this document. I must be committed to the decisions of the Palestinian Authority and its security apparatus ... and refrain from carrying out any military or security activities against the Israelis."

Abu Obeida, a Hamas spokesman in the Gaza Strip, slammed Fatah for the amnesty agreement, saying it was meant "to destroy the spirit of the resistance" and allow Israel to focus on Hamas militants.

Kamel Ghanam, a Fatah militia leader in Ramallah, said all 40 of the militia's men in the city have signed the pledge.

"We feel that we have a new political atmosphere. We are optimistic," Ghanam said.

In Bethlehem, Amjad Khalawi, a 35-year-old Fatah gunman, signed the document and came out of hiding after six years. Khalawi said he planned to get his hair cut for the first time since going underground to evade the Israelis, and would become a member of the Palestinian Preventive Security organization.

"I am happy for this end," he said.

In other moves aimed at helping Abbas, Israel has begun transferring Palestinian tax revenues that were frozen after Hamas won a Palestinian election in 2006, drawing an international boycott. The money has allowed Abbas' government to resume paying salaries to civil servants.

Denouncing Abbas' rule of the West Bank as unconstitutional, Hamas called a Sunday meeting of the Palestinian parliament. But with dozens of Hamas lawmakers in Israeli prisons, only 30 of the 132 members showed up, all from Hamas, and the meeting was postponed because of the low attendance.

President Bush will call for an international conference this fall to include Israel, the Palestinian authority and some of their Arab neighbors to help restart Mideast peace talks and will pledge increased aid to the Palestinian government of President Mahmoud Abbas, The Associated Press has learned.

Secretary of State Condoleezza Rice would lead the peace conference, which would include representatives of Israel and "neighbors in the region," said a senior administration official who spoke on the condition of anonymity.

Bush planned to speak Monday afternoon at the White House about the peace conference and U.S. financial and diplomatic support for Abbas, who controls just the West Bank after the Islamic militant group Hamas gained authority over Gaza in June.

Bush will portray this as "a moment of choice" between two paths for the Palestinian people — one represented by the moderate government led by Abbas and his Fatah faction and that of Hamas.

The official spoke anonymously because the president had not yet given his speech.

The fall conference among Palestinian and Israeli officials and other countries in the region would be a way to prod the peace process. It would be one of the few times that Israelis and Arab leaders have met jointly to work out their differences.

Bush will also call for Israel to remove authorized outposts in Palestinian territory and end settlement expansion, the official said. And he will urge Israel to continue releasing tax revenues to the Palestinian authority.

White House spokesman Tony Snow said Bush would talk about "helping the forces of moderation" in the Middle East and attempt to get "people on both sides to step up and start working, to energize the peace process."

Bush will outline U.S financial support for the Abbas government, including $190 million in mostly already-approved direct aid to the Palestinians. He will await recommendations from former British Prime Minister Tony Blair before deciding whether asking Congress for more, the senior official said.

Blair was recently named as special envoy to the region by the "Quartet" of Mideast peace makers — the U.S., European Union, United Nations and Russia.

That group meets in Portugal on Thursday, at which time Rice and other international negotiators will meet with Blair as he begins his new assignment. Snow said that Bush had discussed his new proposals with Blair.

Bush will talk about Blair's role in his Mideast remarks, the senior administration official said.

The president will also call for an international meeting of "donor" nations to discuss financial ways of helping the Abbas government, the official said.

Bush will tell Abbas that with increased U.S. and international financial support comes an obligation to reach out more to Israel and end incitement, the official said.

A senior administration official earlier said the president would announce aid above the $86 million that the White House already has requested from Congress. That money was to help provide security for Abbas' Fatah faction. The administration also has pledged to contribute $40 million to the United Nations to help the Palestinians, particularly in the Gaza Strip now controlled by Hamas.

After a meeting Monday in Jerusalem between Israeli and Palestinian leaders, Palestinian negotiator Saeb Erekat talked about Bush's upcoming announcement. "I think it's a clear-cut endgame here. We are talking about President Bush's vision of a two-state solution," said Erekat.

He added that Bush should address "how do you translate this from a vision to a realistic political track? How do you move from a policy of what's possible to a policy of what is needed?"

"In order to restore credibility and integrity to the peace process, the people of this region, Palestinians and Israelis, must start seeing deeds and not merely words," Erekat said.

National security adviser Stephen Hadley said there is now an opportunity "to show the Palestinian people a choice between the kind of violence and chaos under Hamas in Gaza and the prospect, under President Abbas and Prime Minister Fayyad, for an effective, democratic Palestinian state that can be on the way toward what we all want, which is a two-state solution — a Palestinian homeland for the Palestinian people."

Five years ago, Bush called for a separate, independent Palestine alongside Israel. He was the first U.S. president to back that notion so fully and publicly. But his administration has taken heavy criticism for letting the peace process drift while conditions worsened for the impoverished Palestinians.

Sen. Jack Reed, D-R.I., said Sunday the administration has not done enough.

"They've had a hands-off attitude for many, many years now. And at a critical juncture, when Abbas was just taking over, when there was an opportunity to really support him, the administration was not doing that," Reed said on CNN's "Late Edition."

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Associated Press Writer Deb Riechmann contributed to this story.

The quartet of Middle East mediators is expected to back U.S. plans to revive Israeli-Palestinian peace moves and hear from new special envoy Tony Blair when it meets in Portugal on Thursday.

It will be the first session bringing together top diplomats from the United States, Russia, the European Union and the United Nations since Islamist Hamas took over Gaza last month and U.S.-supported Palestinian President Mahmoud Abbas formed a caretaker government in the West Bank.

"It's a good opportunity for them to get together, take stock of what has happened over the past couple weeks, as well as to look ahead and chart a course out for the next several months," State Department spokesman Sean McCormack said.

The meeting will mark Blair's first appearance as quartet special envoy.

The former British prime minister's mandate is to help build up Palestinian institutions and encourage economic development but some diplomats want him involved in peacemaking, a role dominated by U.S. Secretary of State Condoleezza Rice and one that Washington wants her to keep.

"There are mixed feelings in the Bush administration about how much rope Tony Blair should get," said Bruce Riedel, a former CIA analyst now at the Brookings Institution.

The quartet has thrown its weight behind Abbas, and is looking for more public expressions of support for the moderate Palestinian leader and greater isolation of Hamas.

The United States, the European Union and Israel consider Hamas a terrorist organization but Russia has been more open to dealing with the group.

"The issue of Hamas is front and center of all of this. I don't sense there is any unanimity on this issue," said Jon Alterman, a Middle East expert from the Center for Strategic and International Studies, a Washington think tank.

U.S. President George W. Bush this week announced plans for a Middle East peace conference in the autumn, probably in the United States, to bring together Israel, moderate Palestinian leaders and their Arab neighbors.

ENDORSEMENT

The quartet meeting in Lisbon is likely to endorse the conference, whose composition and goals are unclear.

"We want the international meeting to be an important step ... We said many times this has been a long overdue step," said the EU's foreign policy chief Javier Solana, speaking in Ramallah after meeting Abbas.

"I think the possibilities now of moving together (Israel and the Palestinians) are becoming better. I think a new momentum may be created," he said.

Egypt's Foreign Minister Ahmed Aboul Gheit said he hoped the quartet would lend authority to Abbas.

"We are also hopeful that the meeting tomorrow will help the launching of negotiation between Israelis and Palestinians, that would aim at realizing a final settlement and discussions on the end game," Gheit told reporters in Portugal, which holds the rotating EU presidency.

The Palestinians and the Israelis have not tackled any of the so-called "final status" issues -- the return of refugees, the status of Jerusalem, and the future outlines of a Palestinian state for years.

EU diplomats said the quartet had dropped for the moment the idea of holding a joint meeting with the Arab League's quartet -- Egypt, Jordan, Saudi Arabia and the United Arab Emirates -- and Israeli and Palestinian representatives, partly because Israel was not keen and preferred to pursue its bilateral track with Abbas.

(Additional reporting by Paul Taylor in Brussels, Wafa Amr in Ramallah and Henrique Almeida in Lisbon)

A U.S.-sponsored international conference on Israeli-Palestinian peace is doomed to fail because it will serve only Israel's interests, Hamas chief Khaled Meshaal said in a CNN interview broadcast on Monday.

Calling the gathering, expected in November, "a meeting controlled and directed by (U.S. Secretary of State) Condoleezza Rice," Meshaal, who lives in exile in Damascus, said neither Israel nor the United States was serious about achieving peace.

"There is no doubt that the outcome will be leaning towards Israel's best interest because (Israeli Prime Minister Ehud) Olmert is the stronger side in the negotiations," Meshaal said, according to CNN's translation of his comments in Arabic.

"All these reasons are going to lead to a failure," said Meshaal, who was injected with poison by Israeli agents in Jordan in 1997 but was saved by an antidote sent from Israel after his attackers were overpowered and arrested.

Hamas Islamists, who violently took control of the Gaza Strip in June, have rejected Western calls to recognize Israel, renounce violence and accept existing interim Israeli-Palestinian peace accords.

Leaders of Hamas, whose 1988 founding charter calls for the Jewish state's destruction, have offered a long-term truce with Israel in return for a viable Palestinian state in the occupied West Bank and in the Gaza Strip.

"The American administration is fighting Hamas and working on isolating it," Meshaal said in the interview, which CNN reported was held in a heavily guarded Hamas safe house in the Syrian capital.

But Meshaal said Washington, which supports Palestinian President Mahmoud Abbas of Fatah, would eventually realize it would have to deal with Hamas for the sake of Israeli-Palestinian peace.

"I only want to tell them to take a short cut and not waste their efforts," he said, while acknowledging that a U.S. invitation to Hamas to attend the upcoming conference was unlikely.

Meshaal called on the international community to deal with "the reality of the Palestinian arena" -- an apparent reference to Hamas's strong influence -- and move the Middle East closer to "genuine peace" in which "the waterfall of blood will stop."

Secretary of State Condoleezza Rice said Wednesday that Israelis and Palestinians have a new "moment of opportunity" to forge peace despite the eruption of fresh tensions between the two sides over preparations for a U.S.-hosted Mideast conference.

Even as President Bush said he was optimistic about the conference and the creation of a Palestinian state, Rice faced growing difficulties in her efforts to organize the meeting set for November or December to launch formal Israeli-Palestinian peace talks.

Rice cautioned the going would be tough as she wrapped up four days of intense shuttle diplomacy during which she met twice with Israeli Prime Minister Ehud Olmert and Palestinian president Mahmoud Abbas to bridge wide gaps over a declaration the conference is to endorse.

"I do think it is moment of opportunity, but there is very hard work ahead," Rice told reporters at a news conference with Israeli Foreign Minister Tzipi Livni, who's leading the Israeli negotiating team.

Underscoring the challenges, the Palestinians accused Israel of not being serious enough and Abbas said Israeli actions, including West Bank military raids, were damaging the pre-conference atmosphere.

Israel is "hindering the endeavor to reach a document with substance," Abbas said after seeing Rice at his office in Ramallah, stressing little time is left for the meeting. "We must not waste time."

The Israelis and Palestinians have vastly different expectations for the conference, where they are to present a document that would start negotiations to create a Palestinian state. The Palestinians want a detailed document. The Israelis favor a general agreement.

A senior Palestinian official said Abbas was disappointed by U.S. suggestions that he significantly scale back their demands for the joint statement to address Israeli concerns.

The Palestinians want the document to include at least a sentence or two on how to solve each of the issues of dispute, such as borders and Jerusalem, the Palestinians have maintained.

The Palestinians' core demand is that the future border between Israel and Palestine be based on the pre-1967 Mideast War lines, with modifications through land swaps. Israel captured the West Bank and other areas in the 1967 war.

Rice asked Abbas whether he could accept a more vaguely worded statement, which would not mention the 1967 lines, said the Palestinian official, who spoke on condition of anonymity because he was not authorized to discuss the meeting with reporters.

She also asked whether the Palestinians were willing to drop a mention of Palestinian refugees, another key issue for the Palestinians, from the document, the official said.

Rice did not address the Palestinian complaints, but Livni appeared annoyed when asked about them and said she would not stoop to "play the blame game" or divulge sensitive information about negotiations over the document.

Livni did not address the issue of the 1967 borders but warned that excessive expectations that Palestinians might have if the document is detailed could lead to "frustration and violence."

Livni also appeared to suggest that the matter of Palestinian refugees could be resolved by them returning to the future Palestine, a position that has infuriated the Palestinian side in the past.

But she also reiterated Israel's commitment to a two-state solution and said the Jewish state would make difficult compromises if the Palestinians would, too. She said her negotiating team would have a second meeting with their Palestinian counterparts this week.

While Rice was engaged in tough diplomacy on the ground, Bush told reporters in Washington that he was pleased with his top diplomat's progress and promised a staunch U.S. effort to make the conference a success.

"The reason why there needs to be a vision of what a state could look like is because the Palestinians that have been made promises all these years need to see there's a serious, focused effort to step up a state," Bush said.

He also said he is seeking an Arab "buy-in" for a peace deal, something Rice is also pressing for on her mission. She met with Egyptian President Hosni Mubarak on Tuesday in Cairo and will see Jordan's King Abdullah II in London on Thursday.

Arab countries, notably U.S. allies Egypt, Jordan and Saudi Arabia, have been reluctant to commit to attending the conference unless there are guarantees that it will yield firm results.

But Rice appeared to have won Egypt's backing. After her talks in Cairo, Egyptian Foreign Minister Ahmed Aboul Gheit endorsed the conference publicly less than 24 hours after suggesting it be postponed.

On Wednesday, ahead of Rice's meeting with King Abdullah, a senior Jordanian official echoed the initial Egyptian sentiments, saying the conference should be delayed if more time is deemed necessary.

Rice started her day with an emotional visit to Jesus' traditional birthplace in the West Bank town of Bethlehem. The daughter and granddaughter of Presbyterian ministers, she lit a candle in the grotto and paused for prayer.

"Being here at the birthplace of my Lord and Savior, Jesus Christ, has been a very special and moving experience," she said at the Church of the Nativity. "It is also, I think, a personal reminder that the Prince of Peace is still with us."

In Bethlehem, Rice saw Israel's contentious West Bank separation barrier, which lines the town on two sides.

Israel started building the West Bank barrier in 2002 as a defense against Palestinian attackers who have killed hundreds of Israelis in recent years. Palestinians say the barrier's meandering route cuts off large chunks of land they want for a future state.

Rice said she understood why Israel would need a barrier but that she hoped it would not be necessary in the future.

"Let's be real. There is a security problem," she said. "I look forward to a day when security is brought about in a different way, which is two states living side by side."

Syria said on Sunday it will attend a U.S.-led conference aimed at launching talks to end the Israeli-Palestinian conflict, giving another boost to U.S. efforts to enlist wide Arab support for a new peace drive.

Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas arrived in Washington, where they will meet U.S. President George W. Bush on Monday and then attend Tuesday's conference in Annapolis, Maryland that is expected to launch formal negotiations to end the six-decade conflict.

The meeting represents Bush's most serious effort to solve the conflict seven years after his predecessor Bill Clinton failed to broker a settlement, but all sides have played down the chances of a breakthrough at the conference or soon after.

In a sign of the challenges, U.S. Secretary of State Condoleezza Rice planned to hold a three-way meeting with Israeli and Palestinian officials on Sunday to try to win agreement on a joint document that is to be presented at Annapolis but is not yet agreed, a Palestinian official said.

Palestinian and Israeli officials played down the importance of reaching agreement on a joint document, saying the most important thing was that Annapolis should launch substantive peace talks.

Ending weeks of uncertainty, the official Syrian news agency said Syria "has accepted the American invitation and will send an official delegation headed by Deputy Foreign Minister Fayssal Mekdad."

While the decision to send only a deputy foreign minister might seem a snub, it was a victory for the Bush administration that Syria, a long-time foe of Israel, chose to attend at all.

Olmert spokeswoman Miri Eisin called the Syrian decision a positive move, saying the Israeli-Palestinian track would stay the main focus of the meeting although Syria's participation "could open additional avenues to peace in the Middle East."

Syria, Israel's neighbor to the north, had insisted the meeting also deal with the future of the Israeli-occupied Golan Heights captured in the 1967 Middle East war.

Israel and Syria last held peace negotiations in 2000, in Shepherdstown, West Virginia, but could not reach a deal on the Golan, which overlooks the Sea of Galilee, the Jewish state's main reservoir.

ARAB PARTICIPATION

Abbas aide Nabil Abu Rdainah told reporters that Rice called Abbas on Sunday to try to "bridge the gap between the two sides" and planned to hold a three-way meeting with Israeli Foreign Minister Tzipi Livni and Ahmed Qurei, the head of the Palestinian negotiating team, later in the day.

A senior Israeli official said Rice would host Livni at her residence at Washington's Watergate apartment complex but did not say whether the Palestinians would attend the meeting.

Any effort to bring about peace between Israel and the Palestinians faces myriad challenges.

Abbas in June lost control of the Gaza Strip to Hamas Islamists, who are not invited to Annapolis and have criticized it. Hamas's armed wing vowed to keep fighting Israel and said any concessions would be tantamount to "treason."

Olmert himself is unpopular with voters, not least due to corruption accusations, and faces opposition to concessions from right-wing members in his fragile governing coalition.

Bush has only 14 months left in power.

Faced with the legacy of an unpopular war in Iraq, the conference gives Bush a chance for diplomatic success in the Middle East -- an Israeli-Palestinian peace deal all sides say they hope to achieve before he leaves office in January 2009.

The mere attendance at talks with Israel of Arab states like Saudi Arabia and Syria, which have had cold-to-hostile relations with the Jewish state, appeared to improve chances for an eventual, wider peace.

Livni told reporters that that without support from other Arabs, there was not "a single Palestinian" who could reach a deal with Israel. The prospect of better ties with Arab neighbors could also help Olmert sell any deal.

At Annapolis, Israel and the Palestinians are expected to reaffirm commitments under the U.S.-backed "road map" to peace, agreed in 2003.

Israel has made any final deal conditional on Abbas carrying out a commitment to rein in militants. Palestinians demand Israel fulfill its promise under the plan to halt "settlement activity" in the occupied West Bank.

Olmert told reporters on his plane he hoped Annapolis would launch serious negotiations on "all the core issues that will result in a solution of two states for two peoples."

In Jerusalem, Israeli police set up roadblocks to try to avert violence after a security alert. Israeli troops killed three Palestinian gunmen in raids in Gaza and the West Bank.

(Additional reporting by Wafa Amr in Ramallah and Avida Landau in Jerusalem, writing by Jeffrey Heller, Rebecca Harrison and Arshad Mohammed, editing by David Storey)

Israel and the Palestinians opened on Monday their most serious peace talks in seven years despite differences over what each side aims to achieve.

It took nearly seven weeks to start so-called final-status talks, announced at a U.S.-sponsored conference in Annapolis, Maryland, underscoring the hurdles facing U.S. President George W. Bush in getting a statehood deal in his final year in office.

Monday's negotiations followed Bush's first presidential visit to Israel and the occupied West Bank last week, when he set the goal of signing a peace treaty in 2008.

Israeli Foreign Minister Tzipi Livni and former Palestinian Prime Minister Ahmed Qurei, the chief negotiators, launched the talks in a Jerusalem hotel that will deal with issues such as borders and the fate of Jerusalem and Palestinian refugees.

But an Israeli official said it was unlikely Livni would be prepared to begin discussing those matters in detail at such an early stage.

"It's the first meeting and the first meeting by nature has to be preparatory," the official said.

Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas authorized the start of final-status talks but the leaders remain at odds over the scope of a deal.

Israeli officials said Olmert was seeking a deal that would outline a "framework" for a future Palestinian state with implementation delayed until the Palestinians can ensure Israel's security.

Abbas wants a final peace treaty enabling him to declare a state by the end of the year.

"The difference between our position and the Israelis' is we hope to have a peace treaty concluded by the end of 2008. We should be done with the framework deal in one month or two months maximum," senior Palestinian negotiator Saeb Erekat said.

COALITION TROUBLES

But substantive talks on issues like Jerusalem could put Olmert's coalition government in jeopardy. The right-wing Yisrael Beiteinu party has threatened to pull out, possibly as early as this week.

The first final-status talks since 2001 were supposed to get under way soon after the Annapolis conference in November. But the Palestinians demanded Israel first commit itself to ceasing all settlement activity, as called for under the long-stalled "road map" peace plan.

Under U.S. pressure, Olmert responded with a de-facto halt to new construction work in West Bank settlements. But he has not called off plans to build hundreds of homes in a settlement near Jerusalem known to Israelis as Har Homa and to Palestinians as Jabal Abu Ghneim.

Olmert said Bush had assured him during his visit that the Palestinians would need to meet their security obligations under the road map before any peace deal was implemented.

It is unclear how Olmert and Abbas can reach a deal. Abbas wields little power beyond the West Bank after Hamas Islamists seized control of the Gaza Strip in June.

Weakened by the 2006 Lebanon war, Olmert could face new calls to resign at the end of the month when a commission of inquiry issues its final report on the conflict.

(Additional reporting by Wafa Amr in Ramallah and Ori Lewis in Jerusalem; Editing by Dominic Evans)

Tens of thousands of Palestinians poured from the Gaza Strip into Egypt Wednesday after masked gunmen with explosives destroyed most of the seven-mile wall dividing the border town of Rafah.

The Gazans crossed on foot, in cars or riding donkey carts to buy supplies made scarce by an Israeli blockade of their impoverished territory. Police from the militant group Hamas, which controls Gaza, directed the traffic. Egyptian border guards took no action.

Israeli Foreign Ministry spokesman Arye Mekel said Israel has no forces on the Gaza-Egypt border and, "therefore it is the responsibility of Egypt to ensure that the border operates properly, according to the signed agreements."

"We expect the Egyptians to solve the problem," Mekel said. "Obviously we are worried about the situation. It could potentially allow anybody to enter."

Israeli defense officials said they were concerned Hamas could use the opening of the border to bring weapons and ammunition into Gaza. They spoke on condition of anonymity because the defense ministry had issued no official statement.

The gunmen began breaching the wall dividing Rafah before dawn, according to witnesses and Hamas officials. A total of 17 explosions destroyed the Rafah wall Wednesday, Hamas security officials said. The officials, who spoke on condition of anonymity due to the sensitivity of the matter, said they were allowing Palestinians to move freely through two gaps.

The identity of the gunmen who breached the border was not immediately clear. But Hamas expressed support for the move, saying that, "Blowing up the border wall with Egypt is a reflection of the ... catastrophic situation which the Palestinian people in Gaza are living through due to the blockade."

Thousands of Gazans began crossing into Egypt and returning with milk, cigarettes and plastic bottles of fuel.

Two-thirds of the Rafah wall had been demolished by 10 a.m. and the crowd of Palestinians crossing into Egypt swelled into the tens of thousands.

The destruction continued as Palestinians used a bulldozer to tear down a section of low concrete wall topped with barbed wire to allow easier access for cars.

By late morning, Palestinians across Gaza were trying to reach the border, pushing to board buses, piling into the backs of pickup trucks. However, shops on the Egyptian side had sold most of their wares.

Mohammed Abu Ghazel, 29, said he had crossed the border three times. He bought cigarettes worth $53 in Egypt and sold them for five times that in Gaza, he said.

"This can feed my family for a month," he said.

Guards directed the crowds over the fallen metal through two main crossing areas, inspecting some bags. One man returning to Gaza carried seven pistols that were confiscated by Hamas police. Others walked unhindered over the piles of scrap metal that once made up the border wall.

Gazan Ibrahim Abu Taha, 45, a father of seven, was in the Egyptian section of Rafah with his two brothers and $185 in his pocket. "We want to buy food, we want to buy rice and sugar, milk and wheat and some cheese," Abu Taha said in a telephone interview, adding that he would also buy cheap Egyptian cigarettes.

Abu Taha said he could get such basic foods in Gaza, but at three times the cost.

An off-duty Hamas security officer who identified himself as Abdel Rahman, 29, said this was his first time out of Gaza.

"I can smell the freedom," he said. "We need no border after today."

The territory had been cut off from the world since June, when Hamas seized power in Gaza by force, and Gazans are facing critical shortages of electricity, fuel and other supplies.

Palestinians used explosives to break through the border on several occasions after Israel withdrew from the Gaza Strip in September 2005, and Gaza militants used the breaches to smuggle weapons and people through.

In the past, Egyptian security forces restored order after hours or days.

The latest and largest breach came on the sixth day of a complete closure of Gaza, imposed by Israel and backed by Egypt, in response to a spike in Gaza rocket attacks on Israeli border towns.

Egypt has largely kept its border with Gaza closed since the Hamas takeover, amid concerns of a spillover of Hamas-style militancy into Egypt.

However, Hamas has orchestrated daily demonstrations on the Gaza-Egypt border in an apparent attempt to appeal to Arab public opinion and pressure Egypt to open the passage.

On Tuesday, Israel eased the closure slightly, transferring fuel to restart Gaza's only power plant, and also sent in some cooking gas, food and medicine. Israel has pledged to continue limited shipments because of concerns that a humanitarian crisis could develop in the already impoverished coastal territory.

Dozens of residents gathered at the border waiting to cross after the first explosions Wednesday, witnesses reported. Hamas forces gathered on the scene and prevented people from getting through. On the other side, Egyptian forces focused spotlights on breaks in the wall and deployed troops to block any infiltration attempts from Gaza, the witnesses said.

But by morning thousands of Gazans had massed at the border, and overwhelmed police began letting people cross. Most Egyptian security and police officers were later pulled out from the immediate vicinity of the border, Egyptian security officials said on condition of anonymity because of the sensitivity of the issue. They did not explain why the officers had been withdrawn.

Governments, aid agencies and the U.N. have issued urgent appeals for an end to the Israeli closure of Gaza. Israel's Defense Ministry ruled late Tuesday that 60,000 gallons of diesel fuel will be transferred into Gaza daily, but the crossings will remain closed to other goods and people until further notice.

A Hamas militant was killed in a clash early Wednesday with Israeli forces near the closed Sufa crossing into Gaza, Palestinian officials said. The Israeli military said soldiers exchanged fire with Palestinian militants in the area.

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Associated Press Writer Ashraf Sweilam contributed to this report from Rafah, Egypt.