Israel sets demands in new Syrian peace track

By Jeffrey Heller

JERUSALEM (Reuters) - Israel set terms for concluding a peace deal with Syria on Thursday, closing ranks with Washington in demanding Damascus distance itself from Iran and stop supporting Palestinian and Lebanese militants.

Coordinated announcements on Wednesday by Israel and Syria that they had begun indirect talks in Turkey, the first confirmation of negotiations between the long-time enemies in eight years, drew a lukewarm response from the United States.

Many analysts say U.S. hostility to Damascus, and to its Iranian and Lebanese Hezbollah allies, makes a Syria-Israel deal unlikely before President George W. Bush steps down in January.

Summing up three days of discussions in Istanbul, Turkish Foreign Minister Ala Babacan said both sides were satisfied they had found "shared ground". He said future talks would be held periodically in Turkey.

"The Syrians know what we want and we know what they want," Israeli Prime Minister Ehud Olmert said in Jerusalem. Olmert revealed the talks two days before he faces a second round of police interrogation over graft allegation.

Syria is demanding the return of the Golan Heights, a plateau overlooking Damascus on one side and the Sea of Galilee on another, since Israel captured the strategic territory in the 1967 Middle East war.

Syrian Information Minister Muhsin Bilal condemned Israel's setting of any prior conditions.

"These conditions have already been rejected as is the phrase 'difficult concessions' as what the Syrians are demanding is their right," Bilal told Al Jazeera television.