Obama's last-ditch diplomatic effort won praise from Israel, which will rely on Washington to block the Palestinian UN membership bid, but drew a bitter response from the Palestinians, who said it violated the spirit of the "Arab spring" revolts and showed no sign of backing down.
Addressing the UN General Assembly, Obama - whose earlier peace efforts accomplished little - insisted that Middle East peace "will not come through statements and resolutions" at the world body and put the onus on the two sides to break a yearlong impasse and return to peace talks. "There is no short cut to the end of a conflict that has endured for decades," Obama told an annual gathering of world leaders in New York, though he offered no new prescriptions for relaunching negotiations.
Grappling with economic woes and low poll numbers at home and growing doubts about his leadership abroad, Obama is wading into Middle East diplomacy at a critical juncture for his presidency and America's credibility around the globe.
He faced the daunting test of Washington's already diminished influence in the region in his bid to dissuade the Palestinians from going ahead with a push for statehood in the UN Security Council on Friday in defiance of Israeli objections and a US veto threat.
Obama attempted to strike a delicate balance as he took the UN podium. He sought to reassure Palestinians he was not abandoning his pledge to help them end Israeli occupation and achieve eventual statehood while also placating any Israeli concerns about Washington's commitment to their security.
Members of the General Assembly, where pro-Palestinian sentiment is high and Israel has often felt ostracized, listened politely but without enthusiasm to Obama's 36-minute speech.
There was widespread skepticism on Obama's chances of success in Middle East peace diplomacy and he may only be able to contain the damage from the UN statehood drive.
The Obama administration says that only direct peace talks can lead to peace with the Palestinians, who in turn say almost two decades of fruitless negotiation has left them no choice but to turn to the world body.
NETANYAHU ECHOES OBAMA
Obama followed his speech with a round of talks with Israeli Prime Minister Benjamin Netanyahu, who echoed the president's assertion that negotiations were the only path to a peace deal but offered no new ideas on how to restart talks.
Netanyahu, who has a strained relationship with Obama, predicted the Palestinians' UN bid "will not succeed."
Obama was considered unlikely to lean too hard on the hawkish Israeli leader for concessions to the Palestinians, mindful he cannot afford to alienate Israel's broad base of support among American voters as he seeks re-election in 2012.
Ahead of Obama's talks with Palestinian President Mahmoud Abbas, a key aide, Yasser Abed Rabbo, voiced disappointment over Obama's speech.
"There is a gap between praising the struggle of Arab peoples for the sake of freedom and between an abstract call for negotiations between us and the Israelis ... Freedom should cover the (whole) region." ,"
Signalling European patience was also wearing thin after years of halting US-led diplomacy, French President Nicolas Sarkozy proposed an ambitious timetable to resume peace talks within a month and achieve a definitive deal in a year.
The White House had no immediate comment on Sarkozy's initiative.
The drama over the Palestinian UN bid is playing out as US, Israeli and Palestinian leaders all struggle with the fallout from Arab uprisings that are raising new political tensions across the Middle East.
It also comes as Israel finds itself more isolated than it has been in decades and confronts Washington with the risk that, by again shielding its close ally, the United States will inflame Arab distrust when Obama's outreach to the Muslim world is already faltering.
Taking note of deep frustrations over lack of progress on the Israeli-Palestinian front, he said: "Israelis must know that any agreement provides assurances for their security. Palestinians deserve to know the territorial basis of their state."
Copyright Reuters, 2011