Putting international monitors in place to observe the Middle East conflict was being seen last night as one possible way out of the current impasse. Israeli troops withdrew from the centre of Ramallah in advance of a meeting between President Arafat and the US special envoy, General Anthony Zinni.
Israeli forces killed two Palestinian policemen in separate incidents near the Rafah and Sufa border crossings in the southern Gaza Strip, Palestinian medical sources said.
The Israeli army had no immediate comment on the Rafah incident but said that north of Sufa soldiers shot a Palestinian planting a bomb. In northern Gaza, troops shot dead a Palestinian gunman near the Jewish settlement of Dugit, the Israeli army said.
A Palestinian mother and her four children were killed in the Gaza Strip when a land mine exploded under a donkey cart in which they were riding, a senior Palestinian security official said.
The official blamed Israel for the blast, which happened near a Palestinian police post that Israeli troops had occupied for several days this week before pulling out.
The Israeli army denied any link to the incident.
"It is an ugly crime added to the series of Israeli murders of Palestinian civilians," said public security chief Abdel-Razek al-Majaydeh.
Zaina al-Awawda, 44, her two daughters and two sons died in the explosion, hospital officials said. At least two other people were seriously wounded, they said.
On the diplomatic front, while the Israelis and Palestinians are expressing support for peace moves, differences may crystallise around the Palestinian demand for a freeze on Jewish settlements in the West Bank, as urged in the Mitchell Report.
US Vice-President Mr Cheney is due to meet Crown Prince Adbullah of Saudi Arabia in Jeddah today, where the two men are likely to discuss the Saudi peace initiative. This involves Israeli withdrawal to its 1967 borders in return for "normal" relations between Israel and the Arab states.
The Crown Prince has dismissed the idea of meeting face-to-face with the Israeli Government and intends to promote his plan at the summit of Arab leaders in Beirut at the end of the month. The original Saudi plan emerged in a somewhat unusual manner, in diplomatic terms, at a private dinner with New York Times columnist Thomas Friedman.
Mr Arafat dismissed the partial Israeli withdrawal as window-dressing, saying it was carried out to create a "nice picture" for General Zinni. At a meeting earlier with the Israeli Prime Minister, Mr Sharon, the US envoy requested an Israeli withdrawal, according to reports.
International monitors have been a key element of different UN Security Council texts on the conflict in the past year. However, at all times the notion has met with unenthusiastic US and Israeli responses. This now seems to be changing.
US interest in calming the situation is motivated in part by its desire to win greater Arab support for its campaign to overthrow Saddam Hussein. However, the Crown Prince told CNN yesterday that Saudi Arabia does not support an invasion, which he said would be a "catastrophe".
After a meeting with Israeli Foreign Minister Mr Peres, General Zinni said: "I'm encouraged. Despite the conditions, I think there are the ingredients here for hope."
Mr Peres said progress was possible "because both sides want it and need it".
After meeting Mr Arafat in Ramallah, Mr Zinni said: "All of the meetings were extremely positive. Everyone is committed to get out of this situation."
"I welcome your efforts, General, especially since you preside over the quartet of the United States, Russia, the EU and UN. Let me once again reiterate our full commitment to the peace process, the peace of the brave," Mr Arafat said following the hour-and-a-half private talk between the two men.
Speculation is growing that the Palestinian leader may be allowed to attend the Beirut summit. Israel says Mr Arafat will require its permission to travel abroad even though it lifted restrictions that confined him to Ramallah for three months.
Mr Arafat said the summit was very important: "Sharon is not understanding that the meaning of what he is doing will reflect negatively in this Arab summit conference."
Thousands of Palestinian refugees demonstrated peacefully throughout Lebanon yesterday, demanding that the summit in Beirut support the Palestinian revolt.
At least 1,066 Palestinians and 344 Israelis have been killed in the 18-month uprising.