As Yassir Arafat was holed up in a second-floor office in his besieged Ramallah compound on Friday, George W. Bush was busying himself with one of his most beloved pastimes: tending to his ranch in Crawford, Texas.

When the US president at last emerged to call world leaders and make public comments the next day, his message offered no more support for the beleaguered Palestinian leader than if he had continued to clear brush on his sprawling estate.

"We are at this point because there has not been enough done to fight off terror," he told reporters in a trailer that doubles as his secure video-conference room. "All the leaders in the world must stand up against terror, must do everything in their power to cut off the funding to terrorist organisations, to prevent terrorist organisations from finding safe haven.

"And that especially applies to Chairman Arafat. I believe he can do a lot more to prevent attacks, such as the one that just occurred in Tel Aviv."

The president's intervention capped a weekend that underscored his administration's reluctant and often contradictory policy towards the bloody Israeli-Palestinian conflict. Just hours before Mr Bush spoke to international leaders, his administration supported a UN Security Council resolution calling on Israel to withdraw from Ramallah.

That vote was itself at odds with the analysis of Colin Powell, secretary of state, who laid the blame for the escalating violence squarely at the door of Mr Arafat's compound. Neither Mr Powell nor Mr Bush was prepared to call for the Israelis to withdraw, choosing instead to assert the Israeli right to defensive action against terrorism.

The contradictory positions fit into a pattern established by the Bush administration. On his recent tour of the region, Dick Cheney, US vice-president, held out for the first time the possibility of a meeting with Mr Arafat. But his offer was conditional on the Palestinian leader's implementing the ceasefire plan detailed by George Tenet, director of the Central Intelligence Agency.

In private Mr Cheney has adopted a far harsher tone, according to Israeli officials. Benjamin Ben-Eliezer, Israeli defence minister, told reporters recently that the vice-president was "more extreme than me" and believed talks with Mr Arafat were "a waste of time". Mr Ben-Eliezer later formally apologised and retracted his comments.

As for Mr Powell, his repeated efforts to promote peace talks in the region have produced mixed results. In June, on Mr Powell's last trip to Jerusalem, state department officials said they expected a "cooling-off period" to begin while the secretary of state was in the region. Instead Mr Powell largely backed Israeli plans for a ceasefire to begin only after seven days of zero violence and a six-week cooling-off period. The period of zero violence began with Israeli reports of mortar attacks from the Gaza Strip.

Mr Powell later reversed the administration's refusal to appoint an envoy to the region by naming General Anthony Zinni as his troubleshooter, at the same time as backing the creation of "a viable Palestinian state". Gen Zinni has spent most of this year out of the region.

Even the one fresh initiative for peace - promoted by Crown Prince Abdullah of Saudi Arabia - has been praised by the Bush administration on limited grounds. Mr Powell initially described the plan as a "minor development", while White House officials have welcomed the initiative mostly as a sign of Saudi leadership.

The reality inside the White House is that the Israeli-Palestinian conflict has been submerged in the far deeper war on terror, which remains the Bush administration's overriding priority in foreign policy.

For US officials, the tipping-point came in January, when Israeli authorities intercepted a shipment of 50 tons of arms heading from Iran to the Palestinian Authority. In February, Mr Powell testified that US intelligence was taking "very seriously" reports that Iran was launching anti-Israeli terrorist attacks from Jordan and Lebanon.

Administration officials later pointed to Iran's support for anti- Israeli terrorism as one of the main justifications for including it in "the axis of evil".

But the process of merging Palestinian violence with anti-US terrorism was well under way. In December, Mr Bush described the militant Palestinian group Hamas as one of "our enemies", as he launched a crackdown on its financial assets in the US.

Inclusion of Hamas in the war on terror stretched the administration's definition of its enemies from "terrorist networks with global reach" to a group the state department describes as active only "in the Gaza Strip and a few areas of the West Bank".

That hardline approach was underscored last month when Mr Powell added the al-Aqsa Martyrs Brigades - the most deadly group linked to Mr Arafat's Fatah faction - to its list of foreign terrorist groups, freezing its US assets in the process.

The overwhelming challenge for the administration is the task of pursuing the war on terror at a time when its Arab and European allies strongly reject its policy towards the Israeli-Palestinian conflict.

"If the US cares about its standing in the region, it should find ways to tell Sharon to be restrained. It has economic and military means of pressure," says a senior Arab official. "It is crucial that the US takes a public position distancing itself from Sharon and says that the use of American weapons in this conflict is illegal and contrary to international law. This issue is the most important issue in the Arab world and provokes anger . . . [aimed] directly at the US."

The contradictory US signals have left Arab leaders confused and the Arab public infuriated. While Mr Bush insists that "terror must stop", the message from the Arab summit in Beirut last week was that for peace to exist, the Israeli occupation must stop. The clear message from the Arab nations was that they see terror as a symptom of Israel's policies that can be eliminated only when the humiliation of Palestinians ceases.

The Beirut declaration issued by the Arab League's 22 member states stressed that, while terrorism was condemned, it must not be confused with "a right of resistance to occupation". That contradicts US policies towards Hamas and the al-Aqsa Martyrs Brigade.

"Palestinians are being told to stop terrorism - and Israel considers everything including stone-throwing now as terrorism - just sit there in a corner and shut up while I [Israel] continue the occupation," says a Saudi official. "People make the argument that you have to understand the Israelis and understand their fear. It's tragic. But I have yet to see someone saying you have to understand the Palestinians."

Arab nations have already signalled their disapproval of US policy towards Saddam Hussein. For the first time since the Gulf war, Iraq and Kuwait agreed in Beirut on a resolution calling for a reconciliation. Saudi Arabia's Crown Prince Abdullah embraced Izzat Ibrahim, Mr Saddam's envoy to the summit. "It's a very positive achievement," Crown Prince Abdullah says of the Iraq-Kuwait agreement.

In Europe too, US policy towards the Palestinian Authority is straining the international coalition against terrorism. "We said a year ago that without the PA what you get is Palestinian anarchy and here we are," says one European diplomat.

Even for the administration's foreign policy supporters in Washington, the outlook appears grim. "We have to let it get worse before it gets better," says one senior Republican. "At the same time it's perfectly legitimate to say the Americans waited too long; they did not get involved when they should have."

Additional reporting by Avi Machlis

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