US, Israel at odds before White House talks

Obama set up an open conflict with Netanyahu on Thursday in his long-awaited speech on the "Arab Spring" revolts, by saying that territorial lines in place before the 1967 Arab-Israeli war should be the basis for a peace deal.

Netanyahu has long opposed such a formulation, and his office issued a blunt statement saying such a scheme would leave it "indefensible" and would isolate major Israeli settlements in the West Bank.

Analysts said Obama became the first president to specifically state that the 1967 borders should be the basis for peace negotiations between Israel and the Palestinians, shut down over a settlements row last year.

US officials had, however, privately been pushing the position for a while and the principle was close to the shape of a failed deal advanced by former president Bill Clinton at Camp David in 2000.

"The borders of Israel and Palestine should be based on the 1967 lines with mutually agreed swaps, so that secure and recognized borders are established for both states," Obama said in the speech at the State Department.

Netanyahu\'s statement, however, urged Obama to commit to assurances laid out in 2004 by then-president George W. Bush, who said "new realities on the ground," meant a "full and complete return" to 1967 borders was "unrealistic."

"Prime Minister Netanyahu expects to hear a reaffirmation from President Obama of US commitments made to Israel in 2004, which were overwhelmingly supported by both houses of Congress," Netanyahu\'s statement said.

Netanyahu appeared to be playing a political card ahead of Obama\'s 2012 reelection race, as top Republican White House contenders slammed the president\'s speech as a betrayal of Israel.

The New York Times reported late Thursday that Netanyahu had called US Secretary of State Hillary Clinton prior to the speech to angrily demand that the language on the 1967 borders be dropped.

Palestinians have responded to the speech cautiously, with Western-backed Palestinian leader Mahmud Abbas calling an urgent meeting of top advisers to discuss the way forward.

Obama warned in the speech that the recently concluded unity deal between Abbas\'s Fatah and the Islamist Hamas movement -- which is sworn to Israel\'s destruction -- posed "profound and legitimate questions" for the Jewish state.

"How can one negotiate with a party that has shown itself unwilling to recognize your right to exist?" Obama said.

In another concession to Israel, he also bluntly told Palestinians that their effort to try to win recognition as a state at the UN General Assembly in September would fail.

But Obama offered no new ideas on how to revive direct Israeli-Palestinian talks, which collapsed last year.

Obama was due to hold closed door talks with Netanyahu at the White House before the leaders make statements to the press and then have a working lunch.

The meeting will take place in a week of frenzied Middle East diplomacy in Washington.

Obama will address the powerful Israel lobby, the American Israel Public Affairs Committee (AIPAC) on Sunday before heading off on a week-long trip to Europe.

Netanyahu will also speak to AIPAC and will make a joint address to Congress next week, encouraged by Republican leaders who support his position.

The president also used the speech to explain the sometimes contradictory US response to the wave of uprisings in the Middle East and North Africa.

He called on Syrian President Bashar al-Assad to lead a transition or "leave," further stiffening the US line a day after slapping new sanctions on the leadership over a fierce crackdown on demonstrations.

Obama demanded a real dialogue between the government and opposition forces in Bahrain, in a showdown that has forced the United States to choose between a key military ally and its support for universal principles.

The president said that Yemen\'s President Ali Abdullah Saleh should follow up on his vows to cede power, and that Libya\'s Moamer Kadhafi would "inevitably" be forced out.

Obama said that the uprisings had shown that repression by autocratic leaders could not stifle demands for individual freedoms.

"Those shouts of human dignity are being heard across the region, and through the moral force of nonviolence, the people of the region have achieved more change in six months than terrorists have accomplished in decades."

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