Saudi Arabia’s foreign minister said Wednesday that his country would consider attending President Bush’s planned Israeli-Palestinian peace conference in the fall, which would put Saudi officials publicly at the same table as their Israeli counterparts for the first time since 1991.

But Saudi officials said a precondition of its attendance was that the conference tackle the four big “final status” issues that had bedeviled peace negotiators since 1979: the fate of Palestinian refugees who fled or were forced to flee their homes in Israel, mostly before or during the 1948 war; the status of Jerusalem; the borders of a Palestinian state; and the dismantlement of Israeli settlements in the West Bank.

“We are interested in a peace conference that deals with the substance of peace, not just form,” Saudi Arabia’s foreign minister, Prince Saud al-Faisal, said at a news conference in Jidda, Saudi Arabia, with Secretary of State Condoleezza Rice and Defense Secretary Robert M. Gates. “If it does so, it would be of great interest to Saudi Arabia.”

The Israeli foreign minister, Tzipi Livni, said later on Wednesday during meetings with Ms. Rice, who flew to Jerusalem after the talks with the Saudis in Jidda, that Israel welcomed the Saudi comments. But in a sign that the Saudi precondition may not be so easy to meet, she added that sometimes “it’s not wise to put the most sensitive issues out first.”

American officials who have been traveling through the region with Ms. Rice and Mr. Gates to try to woo America’s Sunni Arab allies to help out in Iraq and to embrace Israel, took heart from Prince Saud’s remarks. “We interpret this as positive,” a senior administration official traveling with Ms. Rice told reporters aboard her plane en route to Jerusalem, on condition of anonymity so as not to upstage the secretary of state.

If Saudi officials do sit down with the Israelis, it will be the first time they have both attended public talks about Israeli-Palestinian peace since the Madrid conference in October 1991. Saudi Arabia, which is the birthplace of Islam, does not recognize Israel, although Saudi officials have also urged the Bush administration to push hard to resolve the Palestinian-Israeli peace issue. There have been some unconfirmed reports of other contacts between Israeli and Saudi officials, including earlier this year.

Prince Saud also said that his country was considering opening an embassy in Baghdad and that he was “astonished” by recent criticism of its Iraq policy by a Bush administration official.

Prince Saud said he would send a diplomatic mission to Baghdad “to explore how we can start an embassy in Iraq,” a step the Bush administration has long sought, to add legitimacy to the government of Prime Minister Nuri Kamal al-Maliki.

The Bush administration’s relations with the Saudis have been strained in recent months. Zalmay Khalilzad, the United States ambassador to the United Nations, said recently that some Arab allies of the United States in the region had been “pursuing destabilizing policies” with regard to Iraq.

Senior administration officials complained privately that Saudi Arabia and other Sunni Arab allies of the United States had given support and funds to opponents of the Maliki government.

Officials of Saudi Arabia, which considers itself the leader of the Sunni Arab world, have long had doubts about Mr. Maliki’s government, considering it a largely pro-Shiite entity that does not look after the interests of Sunni Muslims and is providing Iran, a majority Shiite country, with a bridge to expand its influence in the region.

Even so, Prince Saud bluntly rejected Mr. Khalilzad’s comments. “I was astonished by what he said, especially since we have never heard from him these criticisms when he was here,” he said, referring to Mr. Khalilzad’s job until earlier this year as ambassador to Iraq.

Ms. Rice and Mr. Gates arrived in Saudi Arabia on Tuesday night in an unusual joint visit for talks with King Abdullah and other senior officials, on a proposed arms package the Bush administration is offering the Saudis, the Israeli-Palestinian peace efforts and stabilizing Iraq. After the meeting on Wednesday morning, Mr. Gates flew on to Kuwait for meetings with officials there while Ms. Rice continued on to Jerusalem.

Ms. Rice welcomed the Saudi offer to explore establishing an embassy and said the visit, which included a lavish banquet at the king’s summer palace in Jidda, had reaffirmed the ties between Washington and the kingdom. She has tried to play down Mr. Khalilzad’s remarks and on Wednesday maintained that the relationship was strong enough to withstand such disagreements.

“If there are problems we have with Saudi policies, we tell them,” she said. “If there are problems the Saudis have with us, we talk about it.” she said.

The banquet given by King Abdullah on Tuesday night featured a buffet that stretched for 20 yards and featured an astonishing range of dishes, American officials said. Guests were seated so they could gaze upon a gigantic wall-size aquarium that included hundreds of fish and at least two eight-foot sharks that were themselves fed as some diners watched.

Prince Saud gave little ground during the talks on an effort by the administration to step up efforts to halt Saudis intent on joining the insurgency in Iraq from crossing the border or traveling through Syria. He said Saudi Arabia was already making efforts to stop its citizens from going to Iraq and raised the opposite concern — that terrorists were crossing into Saudi Arabia from Iraq.

“All that we can do in order to protect the border in Iraq we have been doing,” he said. “The traffic of terrorists is, I can assure you, more concerning to us coming from Iraq, and this is one of the worries our government has.”

The dispute reflects the deep disagreement between the United States and Saudi Arabia over the Maliki government, which Saudi officials say privately has not taken many of the steps, like passing an oil law, that it has promised to take to promote reconciliation between Sunnis and Shiites.

American officials have also been frustrated at the glacial pace of the Iraqi government, even with nearly 30,000 additional American troops on the ground. Mr. Gates acknowledged in recent days that the Saudis viewed Mr. Maliki’s ties to fellow Shiites in Iran as giving Tehran a bridge to expand its power in the Middle East and possibly threaten the largely Sunni governments.