The main players in the Middle East peace process hope Barack Obama will make the issue a top priority when he takes over the US presidency in January, UN Secretary General Ban Ki-moon said on Tuesday.

Last weekend the Quartet of Middle East peace mediators - the European Union, Russia, the United Nations and the United States - met in Egypt to keep alive Israeli-Palestinian peace talks, even though political uncertainty in Israel has scotched hopes for a deal this year.

Ban represented the United Nations at the meeting with US Secretary of State Condoleezza Rice, Russian Foreign Minister Sergei Lavrov and EU foreign policy chief Javier Solana.

It was expected to be Rice's last trip to the region before Obama takes office in January.

"We expect negotiations to continue uninterrupted through the coming period of transition," Ban told a news conference.

"And all parties will be looking to the incoming US administration to engage early, as a matter of highest priority," he said. "The goal remains clear to all - an end of conflict, an end of occupation, a two-state solution." He added that all members of the Quartet "regret that an agreement is unlikely to be reached by... the end of this year."

Ban reiterated that it was important to support the Palestinian government's attempt to build security and improve living conditions for Palestinians.

This required action on commitments under the 2003 "roadmap" peace framework, "including on [Jewish] settlements, as well as a cessation of actions such as house demolitions that are contrary to international law or alter the status quo, including in east Jerusalem," he said.

The Quartet members have strongly backed the talks launched at Annapolis, Maryland, nearly a year ago by President George W. Bush, despite expectations that he would fail to meet his year-end target.

The Israeli-Palestinian talks have been hobbled from the start by violence and bitter disputes over Jewish settlement building and the future of Jerusalem. There are also worries that the process could fall apart amid political transitions in Israel and the United States.

‘Halt Annapolis’

Israeli opposition leader Benjamin Netanyahu’s office said Tuesday he will halt peace talks with the Palestinians in their current form if he wins a national election next February, but will instead step up efforts to develop the Palestinian economy.

Spokeswoman Dina Libster said the Israeli politician, a strong contender to be the next prime minister, believes the talks launched by President Bush in Annapolis, Maryland, last year have failed.

“He thinks the Annapolis process and negotiations taking place now are mistaken,” Libster said.

The Annapolis talks aim to resolve all key areas of dispute with the Palestinians, including the conflicting claims to the holy city of Jerusalem.

Netanyahu does not want to halt talks, but he believes it's premature to talk about a final peace deal, and sharing control of Jerusalem is out of the question, Libster said.

‘Looming confrontation’

Outgoing Israeli Prime Minister Ehud Olmert warned on Tuesday of a looming confrontation with the Islamist Hamas movement which controls the Gaza Strip.

“I have no doubt that the situation between us and Hamas is an unavoidable pre-confrontation situation,” Olmert said while touring the military headquarters responsible for the Gaza region.

“It’s only a question of time and not a question of if,” his office quoted him as saying on the tour.

“We are not eager for it but we are not afraid either and if there is a need to fight Hamas we will do so. In any event we should be alert and prepared.” Israel imposed a blockade of Gaza after Hamas seized control of the territory from forces loyal to Western-backed Palestinian President Mahmoud Abbas in June last year.

A ceasefire in and around the territory went into effect on June 19, but fighters have conducted sporadic rocket and mortar attacks to which Israel has responded by tightening the territory’s closure.

Fuel delivery

Israel renewed fuel deliveries to the Gaza Strip on Tuesday, ending a week-long suspension of supplies that led to blackouts in the Hamas-controlled enclave where militants had launched cross-border rocket attacks.

But the UN Relief and Works Agency (UNRWA) said it would be forced to suspend food distribution to 750,000 Gazans on Thursday night unless Israel opened the Gaza Strip’s border crossings to humanitarian supplies.

UNRWA spokesman Christopher Gunness said the agency’s warehouses were running out of wheat, meat, powdered milk and cooking oil.

About half of Gaza’s 1.5 million residents lost power on Monday when their sole power plant shut down, due to what Palestinian officials said was a lack of fuel.

Palestinian workers said the first delivery for the power plant had been received at the Nahal Oz fuel depot.

Israel had blocked shipments of EU-funded fuel for a week in response to a surge in rocket attacks by Palestinian fighters, who said they were responding to an Israeli raid that killed six gunmen on November 4.