Oct. 31 (Bloomberg) -- Secretary of State Hillary Clinton has returned to the Middle East in a bid to prod Israelis and Palestinians to the negotiating table five weeks after President Barack Obama failed to kick-start peace talks.

Clinton arrived in Israel today for consultations with Prime Minister Benjamin Netanyahu, who has resisted U.S. pressure to halt settlement construction in the West Bank as a gesture toward peacemaking with the Palestinians. Her talks with the Israeli leader follow her meeting in Abu Dhabi on the Persian Gulf with Palestinian Authority President Mahmoud Abbas.

The secretary’s trip is intended to encourage the two sides to “narrow the gap” in their positions in order to get peace negotiations restarted, said State Department spokesman P.J. Crowley. He said the U.S. “continues to talk to all of the parties to help them clarify what the details are” of possible compromise solutions.

The Mideast swing comes a week after Clinton told Obama that it is premature to resume formal Israeli-Palestinian peace negotiations. The Palestinians need to take more steps to prevent terror, and Israel needs to do more to improve the lives of the Palestinians, an official said Clinton told Obama.

Difficult Issues

“We are going to continue down this road and do everything we can to clear away whatever concerns that the parties have, to actually get them into negotiations where they then can thrash out all of these difficult issues,” Clinton said in an interview with CNN before she left Pakistan.

Obama had ordered a review of the peace effort after holding a three-way meeting with Abbas and Netanyahu Sept. 22 in New York.

In Jerusalem, Netanyahu met yesterday with U.S. envoy George Mitchell to prepare for the Clinton meeting and said he hoped the secretary of state would enable Israelis and Palestinians to restart peace talks “as soon as possible.”

Still, Clinton may be anticipating extended diplomacy before the U.S. can show results. Abbas has said he won’t return to the negotiating table until Netanyahu backs a settlement freeze.

“President Abbas stressed that peace talks with Israel can’t be resumed before it halts all settlement activities,” Palestinian Authority negotiator Saeb Erakat said about the meeting with Clinton in an e-mailed statement today. All settlement actions, including what Israel terms as natural growth, must stop before any peace negotiations can resume, Erekat said.

Jewish Settlements

The Associated Press reported that Erakat, in an interview, said Clinton had asked Abbas to allow Israel to complete construction of 3,000 units in Jewish settlements in the West Bank.

Asked about the report, Crowley said, “it’s not for us to make a counteroffer, it’s for us to work with both sides and see if we can’t narrow those positions to a point where negotiations make sense.”

Palestinians have been losing faith in Obama’s peacemaking ability and in U.S. policies in the Mideast, according to a survey released Oct. 18 by the Jerusalem Media & Communications Center. Slightly less than 24 percent of those questioned said Obama could boost chances of peace, down from 35.4 percent who in June said they were optimistic about U.S. participation in the Mideast effort, according to the poll.

Gesture From Netanyahu

“I don’t think that Abbas will go back to the table without at least satisfying the issue of settlement expansion,” said Mkhaimar Abusada, a political scientist at Al-Azhar University in the Gaza Strip. “There has to be some kind of gesture from Netanyahu, even if it’s just temporary.”

Israelis and Palestinians are still fighting over the same issues since peace talks began through the 1993 Oslo accords at a White House ceremony presided over by former President Bill Clinton, Hillary Clinton’s husband. The agenda includes the future of Jerusalem, the fate of Palestinian refugees and the borders of a future Palestinian state.

“I watched in the ‘90s as my husband just kept pushing and pushing and pushing and good things happened,” Hillary Clinton said in the CNN interview. “There wasn’t a final agreement but fewer people died, there were more opportunities for economic development, for trade, for exchanges. It had positive effects, even though it didn’t cross the finish line.”

Clinton’s stopover in the Persian Gulf emirate of Abu Dhabi comes after Iran demanded changes to a United Nations-brokered deal that would send Iranian enriched uranium to Russia for processing into nuclear fuel for a Tehran research reactor. The Iranian reaction cast doubts over wider talks to allay suspicions Iran is seeking the means to build a nuclear weapon.

Netanyahu praised the offer made to Iran, according to an e-mailed statement from his office. The proposal “is a positive first step,” Netanyahu told Mitchell yesterday in Jerusalem.

‘No Coincidence’

The United Arab Emirates, an oil-producing U.S. ally that hosts American military bases, is a trading partner for Iran, which ships three-quarters of its refined fuel imports through Emirati ports. The U.S. Congress is considering legislation aimed at cutting off gasoline deliveries to Iran, which relies on imports to meet a third of its refined fuel needs.

Clinton also met with Abu Dhabi Crown Prince Mohammed bin Zayed Al Nahyan during her visit. The crown prince, who is also deputy supreme commander of the U.A.E. armed forces, conferred with Obama at the White House in September.

Clinton plans to wind up her trip in Morocco for a Nov. 2-3 forum involving Middle East countries.

To contact the reporters on this story: Indira Lakshmanan in Abu Dhabi at ilakshmanan@bloomberg.net; Jonathan Ferziger in Jerusalem at jferziger@bloomberg.net

Last Updated: October 31, 2009 14:14 EDT