Clinton confers with leaders on Mideast peace push

WASHINGTON (Reuters) - Secretary of State Hillary Clinton met with Israeli and Palestinian leaders on Tuesday ahead of Thursday's direct peace talks as new violence flared over Jewish settlements in the occupied West Bank.

Clinton met Palestinian President Mahmoud Abbas and was also due to see Israeli Prime Minister Benjamin Netanyahu, whose arrival followed news that four Israeli settlers were shot dead in an attack the Islamist Palestinian group Hamas said was an assault on the peace process.

"The prime minister will tell Clinton the criminal murder proves again the need to stand firmly on Israel's stringent security demands, and there will be no compromise on them," Netanyahu's spokesman, Nir Hefez, told reporters on his plane as it arrived in Washington.

But another Netanyahu spokesman, Mark Regev, played down suggestions the attack might undercut Washington's hopes that Thursday's talks will launch a process that will result in a peace deal within one year.

"We are not looking for excuses not to move forward. We want to move forward in peace, and we hope that no one else is looking for excuses," Regev said.

The White House strongly condemned the attack and urged that it not be allowed to derail the negotiations.

"It is crucial that the parties persevere, keep moving forward even through difficult times, and continue working to achieve a just and lasting peace in the region that provides security for all peoples," it said in a statement.

U.S. President Barack Obama is due to hold White House meetings and host a dinner on Wednesday with Netanyahu and Abbas as well as Jordan's King Abdullah and Egyptian President Hosni Mubarak, expanding the dialogue to two influential Arab neighbors that already have peace deals with Israel.

Netanhayu and Abbas are then expected to begin direct negotiations at the State Department on Thursday, relaunching the peace process after a 20-month hiatus despite widespread skepticism on the prospects for success.

The Washington talks represent Obama's riskiest foray into Israeli-Palestinian peacemaking -- a goal that has eluded generations of U.S. presidents -- and Tuesday's West Bank attack underscored the challenges ahead.

Hamas Islamists in the Gaza Strip, a group which opposes any dialogue with the Jewish state and is not taking part in the Washington talks, issued a statement claiming responsibility for the attack and threatening more.

The United States and its allies have urged all parties to refrain from any action that could disrupt the talks, and an official with Abbas' Fatah party, which holds sway in the West Bank while rival Hamas rules the Gaza Strip, said the attack ran against their own hopes for peace.

"We are against the killing of civilians anywhere -- Palestinians or Israelis. And I hope this was not timed to make it even more difficult for us here," senior Fatah official Nabil Shaath told Reuters Television in Washington.

State Department spokesman P.J. Crowley said Washington realized there were "actors in the region who are deliberately making these kinds of attacks in order to try to sabotage the process", but voiced hope the two sides would not be deterred.

"We want to see not just a successful relaunch tomorrow but an understanding that, going forward, the leaders will meet on a regular basis," Crowley told a news briefing.

He said Washington expected "substantive discussions of the core issues at the heart of the process."

The shooting attack threw a spotlight on the issue of what will happen with Jewish settlement construction the occupied West Bank once Israel's partial, self-imposed moratorium on new building expires on September 26.

The Palestinians have threatened to pull out of the talks unless the moratorium is extended but Netanyahu, who heads a government dominated by pro-settler parties including his own, has given no sign he is ready to take that step.

"There's a lot of anxiety to be honest with you. We are here. We decided to come. We debated it with our people. It has been a long process really bringing us here," Fatah's Shaath said.

"We are dedicated to making it work if possible. But we cannot continue unless the freeze on settlements continues," Shaath said.

Netanyahu, who has pushed along with the United States for direct talks without preconditions, has said the future of settlements should be resolved in negotiations. Washington hopes these can resolve the main disputes within a year.

Many analysts view that goal as unrealistic, citing Israeli and Palestinian internal political divisions and the complexities of issues, including settlements and the fate of Jerusalem, that have defied solution over decades of conflict.

(Additional reporting by Jeffrey Heller and Nadine Alfa in Washington, editing by David Alexander and Sandra Maler)