The Israeli-Palestinian conflict is a crucial element in the international crisis following last week's attacks on New York and Washington. It is a source of outrage in the Arab world and a barrier to the involvement of its leaders in a worldwide campaign against terrorism. Mr Yasser Arafat's decision to call a comprehensive ceasefire this week, along with Mr Ariel Sharon's reciprocal withdrawal of troops from Palestinian-controlled towns were clearly responding to major American and European pressure.
If the ceasefire holds and leads to political progress this will be the most significant breakthrough achieved so far this week in a remarkable round of international diplomacy. Yesterday President Bush urged Mr Arafat to back up the ceasefire with further moves towards negotiations. It took major US pressure on Mr Sharon to secure his response. That is a new element in the Middle East equation - a direct result of last week's events. Washington will be particularly concerned to neutralise Arab hostility arising from the perception that it has been biased in favour of Israel. Some of Mr Bush's officials believe Mr Sharon's insistence on a 48 hours period of total quiet was obstructing the effort to build an international coalition against terrorism. Mr Arafat has taken skilful political advantage of that in insisting on the ceasefire.
These developments may allow Mr Arafat and the Israeli foreign minister, Mr Shimon Peres, to meet very soon. They will discuss how to consolidate the ceasefire and open the way towards implementing confidence-building security measures which would allow the proposals put forward by Mr George Mitchell's commission to be put back on the table. They include a six week cooling off period, a freeze on Israeli settlement activity and a resumption of Israeli -Palestinian security cooperation. That in turn would allow a resumption of the substantive talks that broke off early this year to be resumed.
Such a scenario must look unrealistically optimistic after the violence and bitterness of this year's conflict. But Mr Bush will probably be satisfied to see it calm down while he endeavours to recruit moderate Arab states to his anti-terrorist coalition in preparation for a possible military strike against Afghanistan. Holding violence down will be difficult indeed for both Mr Arafat and Mr Sharon. Radical Palestinian organisations insisting on an end to Israel's illegal occupation are stronger since the current intifada rebellion began a year ago. Mr Sharon's coalition with Labour will be severely strained, as his hard liners refuse to concede anything like what was on offer from the previous Labour government before he was elected last February. But those unfavourable prospects cannot take from the real change registered in response to last week's atrocities.