Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas met on Monday to see if they can narrow differences over Palestinian statehood ahead of a US-sponsored conference in November.

Israeli and Palestinian officials said the talks, held at Olmert's Jerusalem residence, would seek to lay the groundwork for next week's planned visit of US Secretary of State Condoleezza Rice.

Washington is pushing a reluctant Israel to make tangible progress to avoid disappointment at the conference, which Western diplomats said could culminate with the relaunching of long-stalled peace talks.

"I am hopeful," Abbas told Italy's RAI television on the eve of his meeting with Olmert. "But I don't know what are the obstacles -- and we have many of the obstacles -- which will face us. We hope that we can overcome all kinds of obstacles."

Olmert and Abbas have been meeting regularly since Hamas Islamists seized control of the Gaza Strip in June.

The bilateral meetings and the conference are part of a US-led campaign to shore up the Fatah leader's hold on power in the occupied West Bank and to isolate Hamas in Gaza.

It is unclear how any agreements reached between the leaders can be put in place so long as the territories remain divided.

Olmert also has been weakened politically since last year's war in Lebanon, raising doubts among Israelis and Palestinians over his ability to deliver on any peace promises.

Salam Fayyad, whom Abbas appointed prime minister after dismissing the Hamas-led government in June, attended Monday's session, officials said.

Olmert is seeking a broadbrush "declaration of principles" in time for the November conference, whereas Abbas wants a more explicit "framework" agreement with a timeline for implementation on the core issues of borders, Jerusalem and the fate of Palestinian refugees.

Senior Palestinian officials said some progress had been made in recent meetings to narrow the gaps over the nature of a future Palestinian state but that the sides have not yet reached the point of drafting principles.

"Today we hope the two leaders will take it to the next step and start the drafting stage," Abbas aide Saeb Erekat said.

Israeli officials said the talks had started to touch on core issues, but that no new announcements were planned after Monday's session.

A senior Israeli government official said Olmert did not intend to go ahead with plans to release from prison 100 members of Abbas's Fatah faction ahead of the Muslim fasting month of Ramadan, which begins this week.

The prisoner release would take place at a later date, the official said.-Reuters