George Mitchell, Obama's special envoy for Middle East peace, will step down after a frustrating two and a half years seeking to jump-start the stalemated Israeli-Palestinian peace process.

Both President Obama and Secretary of State Hillary Clinton warmly thanked Mitchell, 77, the former Senate majority leader from Maine and North Ireland peace negotiator, for his service, in statements sent out by the White House Friday. Mitchell, in a brief resignation letter to the president, said he'd agreed to serve two years, and had now served longer than that.

His effective resignation date is May 20 - which happens to be the date Obama plans to meet next week with Israeli Prime Minister Benjamin Netanyahu at the White House.

With the Israeli-Palestinian peace process at a complete impasse, the White House said Clinton had named Mitchell's deputy David Hale as acting envoy. But in other ways the envoy's office seemed to have been in the process of being partially dismantled over the past several months, as some deputies departed, the parties resisted negotiations and regional unrest played out.

Mitchell's resignation "has been a long time coming, and it's understandable, since everything is at a standstill," said Hussein Ibish, with the American Task Force for Palestine. "No one can say it's a personal or political failure on his part. ... To be honest, he didn't have a lot to work with here."

Israeli-Palestinian peace talks, launched with fanfare at the White House last September, collapsed just three weeks later, after Israel refused to issue a new West Bank settlement freeze. This year's Arab spring rebellions have further complicated matters. The toppling of Egypt's Hosni Mubarak spooked Israeli leaders who have hunkered down to wait out the regional turmoil. Palestinian leaders, meantime, have pursued a reconciliation agreement with the militant Hamas, and say they are planning to seek statehood recognition from the United Nations next fall, sidestepping negotiations with the Israelis altogether. As the broader regional tumult continues to play out, Washington has had to step back and rethink its overall approach to creating momentum behind the peace process.
Mitchell's resignation "makes formal what was clear for some time--the president's goal of an Israeli-Palestinian peace agreement by September is unattainable and negotiations are not about to resume any time soon," former deputy Middle East Quartet envoy Robert Danin put it bluntly in an analysis written for the Council of Foreign Relations.

Mitchell "basically resigned a few months ago; they just didn't tell anyone," one Democratic Middle East hand said. "He's been effectively gone for a long time."

(Mitchell's resignation letter is dated April 6th.)

One Washington Middle East analyst said he found the timing of Mitchell's resignation announcement a bit strange, coming days before Obama is due to host King Abdullah of Jordan and Netanyahu for visits next week.

Obama also plans to give a major speech on the sweeping political changes in the Middle East and North Africa, next Thursday, the White House's Carney said. Obama's "Cairo 2" speech as it's been dubbed will take place at the State Department, officials told the Envoy.

Obama may also speak--although it is not confirmed--at the annual policy conference of the American Israel Public Affairs Committee (AIPAC). If Obama does address the influential pro-Israel group gathering, the speech would take place on Sunday, May 22 at 10:30am.

After weeks of intense internal debate, the Obama administration has decided to "decouple" his remarks on the sweeping changes occurring in the Middle East from any new major U.S. initiative to outline terms for resolution of the Israeli-Palestinian conflict, Middle East experts who have consulted with the administration on the matter said. That speech - on what the U.S. sees as reasonable terms for the creation of a Palestinian state while ensuring Israel's security -- may now occur in August, ahead of the Palestinians' anticipated bid to seek statehood recognition at the UN, the sources said. The U.S. and Israel both insist that the only way to settle the conflict is through direct negotiations between the parties, a position Obama is certain to restate several times next week.

The White House's Carney fended off any suggestion that Mitchell's resignation might be read as an oblique critique of the administration's diminishing commitment to the peace process -- or as some see it, reluctance to press the parties -- and potentially rile pro-Israel U.S. allies -- as Obama goes into 2012 presidential campaign mode.

"The fact that this is a hard issue, an extraordinarily hard issue, is not news to anyone in this room or anyone who's ever attempted to work on it over these many years," Carney said.

Mitchell, in his resignation letter, stood up for the President's uphill efforts on the peace front, however unappreciated those efforts sometimes seemed by regional leaders.

"I strongly support your vision of comprehensive peace in the Middle East and thank you for giving me the opportunity to be part of your administration," he wrote. "It has been an honor for me to again serve our country."