From left: Israel's Prime Minister Ehud Olmert, King Abdullah of Jordan, Egyptian President Hosni Mubarak and Palestinian President Mahmoud Abbas sit together during a meeting in the Red Sea resort of Sharm el-Sheikh yesterday. Olmert said yesterday a new opportunity had been created to promote the Middle East peace process and he would not let it pass. - Reuters

SHARM EL-SHEIKH, Egypt (Reuters):

Israeli Prime Minister Ehud Olmert said yesterday he intended to free 250 Palestinian prisoners in a goodwill gesture to help President Mahmoud Abbas.

The two leaders held talks in the Egyptian Red Sea resort of Sharm el-Sheikh, their first meeting since Islamist Hamas militants seized the Gaza Strip this month and left Abbas and his secular forces in control of the larger West Bank territory.

Olmert told a joint news conference with Palestinian, Egyptian and Jordanian leaders he would work with "moderates" like Abbas against "terrorists" - a clear reference to Hamas militants - to secure peace in the Middle East.

Two weekly talks

He said he was willing to resume a U.S.-sponsored programme of two weekly talks to push forward with efforts to found a Palestinian state, despite Hamas's control of Gaza.

"I'm optimistic that, especially in these turbulent days ... an opportunity has been created to seriously move forward with the regional peace process. I don't plan to let this opportunity slip away," said Olmert.

"As a gesture of goodwill towards the Palestinians, I today announced my intention to release (about) 250 prisoners who are members of Fatah who do not have blood on their hands, with their commitment not to involve themselves again in terror."

Make good on pledges

Olmert said Israel would make good on pledges, made after Abbas ditched Hamas, to end economic sanctions and pay over hundreds of millions of dollars in Palestinian tax revenues as well as to ease travel restrictions inthe occupied West Bank.

Abbas accused Hamas on yesterday of staging a "bloody coup" in Gaza that had deeply wounded the Palestinian people.

Hamas has accused Abbas of a "coup" by dismissing the Hamas-led Palestinian government that held power before the Gaza takeover and of giving in to "Zionist blackmail".