JERUSALEM - Israel's security cabinet convened after the killing of a Jewish settler yesterday to decide the fate of a ceasefire with the Palestinians that could be vital to United States' efforts to forge a broad anti-terror coalition.
"A retreat from the ceasefire is one of the options," Israeli Transport Minister Ephraim Sneh said before the meeting.
But Israeli commentators said it was unlikely Israeli leaders would risk angering Washington by scrapping the two-day-old truce.
Palestinian President Yasser Arafat also met his own cabinet as the ceasefire, agreed under intense international pressure following last week's suicide-hijack attacks in New York and Washington, hung in the balance.
The truce took a blow earlier in the day when Palestinians fired on a car carrying a settler family back to their home in the occupied West Bank after the Jewish New Year holiday of Rosh Hashanah.
Sarit Amrani was killed and her husband wounded as they drove with their children near the settlement of Tekoa, close to Palestinian-ruled Bethlehem.
A senior Palestinian official said Arafat telephoned Israeli Foreign Minister Shimon Peres after the attack to say he was "very angry" about the killing and would investigate.
Later in the Gaza Strip, Palestinians fired at an Israeli Army post in the Jewish settlement of Kfar Darom, slightly wounding five soldiers, a military spokesman said.
The troops returned fire, killing one of the attackers.
In a separate incident, Palestinian gunmen shot and wounded an Israeli security guard at the Karni commercial crossing between Israel and the Gaza Strip. Israeli forces returned fire, damaging a Palestinian police post but causing no casualties.
Israeli Army Radio said an Israeli tank fired three shells at Palestinian gunmen approaching the Israeli border near the West Bank city of Qalqilya. Palestinian security officials, confirming the shell fire, said no one was hurt.
"I am very sorry the Palestinian Authority did not stand by its commitments and we will decide today how to act," Israeli Prime Minister Ariel Sharon told reporters as he announced the security cabinet meeting.
"This ceasefire was respected for a few hours - 20 hours - and then there was an outbreak of acts of terror ... It began yesterday at seven in the evening and continued today with a great disaster," he added.
The Al-Aqsa Martyrs Brigades, a group linked to Arafat's Fatah faction, claimed responsibility for the West Bank killing.
Palestinian officials regretted the incident but said they were making the maximum effort to ensure the ceasefire held.
Political sources said the Israeli Government would decide whether talks between Peres and Arafat could take place. Israel wants 48 hours of total calm before it starts any talks with the Palestinians.
One source said the meeting on arranging a lasting truce might still go ahead, but a warning could be issued to Arafat that "if the attacks continue, Israel will resume initiated military operations" in Palestinian-ruled areas.
An end to a year of Israeli-Palestinian violence could be crucial to Washington's efforts to enlist Arab and Muslim countries into a coalition it wants to form to battle terrorism.
The level of violence in the West Bank and Gaza Strip has been much reduced, but Sharon was under pressure from settlers and right-wingers to act after the killing of the settler.
The umbrella Yesha Council of Jewish settlements called on Sharon sarcastically to take advantage of the "resounding success" of the ceasefire and meet "the terrorist Arafat".
Speaking to Israeli Army Radio, Palestinian cabinet minister Ziad Abu Zayyad said he was sorry to hear about the Israeli woman's death.
"But I would expect that as the meeting between Arafat and Peres approaches there will be people interested in sabotaging such talks," he said.
Palestinian officials have demanded that Israel lift a crippling military blockade of the West Bank and Gaza Strip in connection with the ceasefire.
The truce talks are intended to pave the way to a renewal of peace negotiations that stalled shortly before a Palestinian revolt against Israeli occupation began last September. At least 584 Palestinians and 168 have been killed in the bloodshed.
- REUTERS
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