Israeli leaders withdrew their threat to quit the Middle East summit talks early this morning after Israeli and Palestinian security officials narrowed differences over a key element of a new peace deal, Palestinian officials said.
The Israelis agreed to pursue negotiations at the Wye River conference centre throughout the night following successful talks mediated by the director of the US Central Intelligence Agency, Mr George Tenet, said officials present at the talks.
Mr Tenet met the Israeli Defence Minister, Mr Yitzhak Mordechai, and a team of Palestinian security officials and negotiators over anti-terrorism measures Israel insists must accompany overdue Israeli troop withdrawals from the West Bank, which are at the heart of the negotiations.
Earlier Israeli Prime Minister Benjamin Netanyahu had announced that his delegation would quit the summit at midnight if an agreement was not reached.
After consulting with Jewish-American organisations on the latest offer, Mr Netanyahu is reported to have said, "We are not suckers, we are not fools."
President Clinton remained on stand-by at the White House ready to helicopter to the Wye Plantation 70 miles east of Washington, while the Secretary of State, Ms Madeleine Albright, worked to find a compromise.
The US delegation had confirmed that the Israelis had asked about departure arrangements. But a senior US official said: "You can predict that there will be some posturing going on in talks like these."
President Clinton, who has devoted over 50 hours to the talks, was ready to make his sixth appearance if necessary.
He was briefed several times on the impasse by Ms Albright and the National Security Adviser, Mr Sandy Berger.
The White House spokesman, Mr Joe Lockhart, said that Mr Clinton would fly to the Wye Plantation if the US delegation thought it would be "productive".
King Hussein of Jordan had also joined the talks from the Mayo Clinic in Minnesota, where he is being treated for cancer.
The US spokesman, Mr James Rubin, said: "We are at a critical moment . . . We can't answer the question of which way this will go. The United States can only do so much."
Mr Rubin said earlier that a US text would be tabled of "what we hope will allow the two sides to put the peace process back on track." No part of the paper "will surprise either side, but whether they can agree on the wording is another matter. The devil is in the details."
The threat to the summit came suddenly yesterday morning after signs the night before that there could be a breakthrough on the difficult security issue which has been the main sticking point.
Both sides were aiming at an interim agreement whereby the Israelis would withdraw from 13 per cent of occupied territory on the West Bank in exchange for security guarantees from the Palestinians.
But yesterday morning an Israeli official accused the Palestinians of wanting to get the 13 per cent of land without giving Israel anything in return. There was no substantial plan by the Palestinians for the fight against terror, the official said.
Other complaints by the Israelis were that the Palestinians would not arrest 120 people on a list of suspected militants, reduce the size of the Palestinian police force, confiscate illegal weapons and convene the Palestine National Council to revoke the parts of its national charter which threaten Israel's existence.
Mr Ahmed Tibi, a senior aide to Mr Arafat, called the Israeli tactics "a type of political blackmail."
He said that the Palestinian National Council had amended its covenant during the past two years and had no plans to do more.