January 9, 2008 Bush meets with Olmert in Jerusalem Play video

JERUSALEM (AP) - Israeli Prime Minister Ehud Olmert said Wednesday that "there will be no peace" unless attacks are halted from all parts of the Palestinian territories, including those not controlled by his negotiating partners in the Palestinian leadership. But he said that both sides "are very seriously trying to move forward" on a deal.

"Israel does not tolerate and will not tolerate the continuation of these vicious attacks," Olmert said, after two and a half hours of talks with President Bush. "We will not hesitate to take all the necessary measures. There will be no peace unless terror is stopped. And terror will have to be stopped everywhere."

On the first day of his eight-day Mideast trip aimed at pushing the Israelis and Palestinians toward an agreement, Bush declared there is a "historic moment, a historic opportunity." But he said he also was "under no allusions" that both sides face complex issues.

"This is going to be hard work," he said. "America cannot dictate the terms of what a state will look like."

Earlier Wednesday, an Israeli airstrike in northern Gaza killed two Palestinians and wounded four others, a move the Israeli army said was taken in response to militants who had been firing projectiles at the rocket-scarred southern Israeli city of Sderot.

He said he and Olmert also discussed Iran. "Iran is a threat to world peace," Bush said.

Bush found himself challenged by his Israeli

allies on a recent U.S. intelligence report saying Iran halted a nuclear weapons program in 2003. Iran's nuclear ambitions are a chief fear in Israel, and the U.S. report led some in the region - both Israelis and Arab nations concerned about rising Iranian influence - to doubt the U.S. commitment to reining Tehran in.

"The fact that they suspended the program was heartening," Bush said. "The fact that they had one was discouraging because they could restart it."

(Copyright 2008 by The Associated Press. All Rights Reserved.)