U.S. President George W. Bush sought to reassure sceptical Arabs yesterday he is committed to securing a deal on Palestinian statehood before he leaves office, despite his outspoken support for Israel.

Wrapping up his Middle East tour in the Egyptian resort of Sharm el-Sheikh, Bush was looking to ease Palestinian dismay over his visit to Israel, where he lavished the Jewish state with praise, hailing it as a «homeland for the chosen people».

Bush planned to use a speech to Arab leaders at an economic forum in Sharm el-Sheikh yesterday to insist that he «firmly believes» a Middle East peace deal can be reached this year ? a deadline widely viewed as unrealistic.

«We must stand with the Palestinian people, who have suffered for decades and earned the right to a homeland of their own,» Bush will say, according to an advance text of his speech.

Adjusting his approach from the one taken during his visit to Israel last week to celebrate its 60th anniversary, Bush will call on Israel to make «tough sacrifices for peace and ease restrictions on Palestinians.»

Bush was alluding to the hardship that Palestinians face from Israeli roadblocks and barriers in the occupied West Bank, measures they call collective punishment but which Israel says are to defend it against militant attacks.

Bush?s more sympathetic language on the Palestinians? plight appeared aimed at countering Arab doubts, reinforced by his Israel visit, about his ability to act as an even-handed peace broker.

Bush also thinks Arab leaders need to stand by Lebanese Prime Minister Fouad Siniora against Hezbollah and to isolate Iran over its nuclear programme.

«To allow the world?s leading sponsor of terror to gain the world?s deadliest weapon would be an unforgivable betrayal of future generations,» Bush will say.

With less than nine months left in office, Bush, highly unpopular in the Arab world because of the Iraq war, will lecture Arab leaders on everything from economics to political reforms.

He will call on Arab states to free all «prisoners of conscience» and open up political debate, saying Washington was «deeply concerned» about the intimidation of democracy activists and the closure of newspapers or civil society organisations.

Oil output

«True democracy requires competitive elections in which opposition candidates are allowed to campaign without fear or intimidation,» Bush will say. «Too often in the Middle East, politics has consisted of one leader in power and the opposition in jail.»

Bush raised the case of jailed Egyptian opposition politician Ayman Nour with President Hosni Mubarak, Bush?s national security adviser Stephen Hadley said. Nour, who unsuccessfully challenged Mubarak in Egypt?s first multi-candidate presidential elections in 2005, is serving a five-year jail term for fraud. He says authorities fabricated the case to block him from politics.

Reflecting U.S. public concerns about high oil prices during a presidential election year, Bush will warn Arab oil producers that their supplies are limited and that they must diversify their economies.

His comments follow a visit to Saudi Arabia where he won a modest increase in oil output for world markets. High oil prices have stoked U.S. recession fears.

Bush, who met Palestinian President Mahmoud Abbas in Sharm el-Sheikh on Saturday, is also seeking broader regional support for the faltering Middle East peace process.

He stoked anger among Palestinians and their Arab allies in a speech to Israel?s parliament on Thursday in which he pledged unflinching support for the Jewish state but made only one reference to Palestinians? dreams of a state of their own.

Bush?s five-day Middle East tour, his second this year, follows a U.S.-hosted conference in Maryland, in November

Matt SPETALNICK

Tabassum ZAKARIA