UPDATE 2-Syria peace talks plans in jeopardy after opposition, Saudi moves
* Syrian opposition to shun peace talks unless Assad exit is goal
* Confident Assad talks of running for re-election next year
* Saudi Arabia plans to halt cooperation with United States on Syria - source
LONDON, Oct 22 (Reuters) - Plans for talks to end the fighting in Syria were in jeopardy on Tuesday after the opposition refused to attend unless President Bashar al-Assad is forced from power and a furious Saudi Arabia made clear it would no longer co-operate with the United States over the civil war.
Western nations and their Middle Eastern allies pressed Syria's fractured opposition to join the proposed peace talks, although Assad has indicated he will not bow to opposition demands that he should step down as a pre-condition.
The United States and Russia said in May they would convene a "Geneva 2" conference to try to end a conflict that has killed well over 100,000 people and forced millions from their homes, but it faces huge obstacles and no firm date has been set.
British Foreign Secretary William Hague, hosting a meeting of 11 nations in London, said it was vital that the Western-backed Syrian opposition join the talks.
"We urge the National Coalition to commit itself fully and to lead and form the heart of any opposition delegation to Geneva," he told a news conference.
However, opposition factions are loathe to discuss anything except the immediate departure of Assad - who said on Monday he saw no reason why he should not run for re-election next year.
"The Sultan must leave," said Syrian opposition chief Ahmed Jarba in the text of a speech to the meeting, referring to Assad. "Geneva cannot succeed and we cannot take part if it allows Assad to gain more time to spill the blood of our people while the world looks on."
Many of the mostly Islamist rebels fighting in Syria refuse to recognise the exiled opposition favoured by the West.
Efforts to present a united front suffered a further setback when it emerged that Saudi Arabia's intelligence chief had said the kingdom would make a "major shift" in relations with the United States in protest at its perceived inaction over Syria and its overtures to Iran.
Prince Bandar bin Sultan has told European diplomats that Washington had failed to act on Syria among other Middle Eastern issues, according to a source close to Saudi policy. "The shift away from the U.S. is a major one," the source said.
There would be no further coordination with the United States over the war in Syria, where the Saudis have armed and financed rebel groups fighting Assad, the source said.
Saudi anger boiled over after Washington refrained from military strikes in response to a poison gas attack in Damascus in August when Assad agreed to give up his chemical arsenal.
Saudi Arabia is also concerned about signs of a tentative reconciliation between Washington and Tehran, the Saudis' old enemy, which may be invited to Geneva.
U.S. Secretary of State John Kerry said the Saudis were "obviously disappointed" that the strike on Syria did not take place.
He said President Barack Obama had asked to him to hold talk to Saudi officials, which he described as "very, very constructive and I am convinced we are on the same page as we are proceeding forward."
Saudi Arabia and the United States shared deep concern about Iran's nuclear programme, Kerry said, adding: "I reaffirmed President Obama's commitment that he will not allow Iran to have a nuclear weapon."
Kerry met Saudi Foreign Minister Saud al-Faisal in Paris on Monday regarding Iran.
"I reiterated our position - in any negotiation (with Iran) --that our eyes are wide open, actions are what will speak to us, not words, and no deal is better than a bad deal," Kerry said.
NO MILITARY SOLUTION
Hague said there was no military solution to the war and urged Syrians to "make the compromises necessary for a peace process to work".
Several officials, including Arab League chief Nabil Elaraby, have said they expect the Geneva 2 conference to convene on Nov. 23, though the United States, Russia and the United Nations have all said no date has been officially set.
In London, Britain, Egypt, France, Germany, Italy, Jordan, Qatar, Saudi Arabia, Turkey, the United Arab Emirates and the United States were to discuss the agenda for the peace talks and to help the opposition prepare for them, a U.S. official said.
While Washington has said it is open to the possibility of Iran, which has supported Assad, coming to a Geneva conference, Kerry said it was hard to see Tehran playing a constructive role unless it backs the idea of a transitional government.
Hague said Iran must support a proposed interim government in Syria including figures from Assad's administration and the opposition as the way to political dialogue and free elections.
"If Iran could start from that position as well as the rest of us, then Iran would be more easily included in international discussions on the subject," he said.
However, the West and its Arab allies are divided on Iranian involvement. Saudi Arabia, which backs Syria's mostly Sunni Muslim rebels, vehemently opposes any inclusion of Shi'ite Iran, its regional arch-rival.
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