Israeli Prime Minister Ehud Olmert said on Tuesday Iran's nuclear program must be stopped by "all possible means" and Tehran must be made to see it would suffer devastating repercussions if it pursued atomic weapons.

The Israeli leader, under criminal investigation at home that could drive him from office, issued his strongest warning yet to Iran in a policy speech to the American Israel Public Affairs Committee, a pro-Israel lobbying group.

"The Iranian threat must be stopped by all possible means," said Olmert, who is expected to discuss the issue in talks with US President George W Bush on Wednesday.

"The international community has a duty and responsibility to clarify to Iran, through drastic measures, that the repercussions of their continued pursuit of nuclear weapons will be devastating," Olmert added.

The United States accuses Iran of pursuing atomic weapons under cover of its civil nuclear program. Iran denies this and has said its nuclear program is to generate electricity. Israel is widely believed to have hundreds of nuclear warheads.

Olmert said international and political sanctions on Iran, whose president has called for Israel's destruction, were "only an initial step."    

In addition to measures agreed by the United Nations, he said, "sanctions should also be initiated by individual countries which have dealings with Iran."    

Olmert, on what some Israeli political commentators have coined his "farewell visit" to the United States, pledged to pursue a "historic breakthrough" by the end of the year in peace talks with the Palestinians.

But he did not say in the speech whether he and Palestinian President Mahmoud Abbas could still meet Washington's target of a framework statehood deal before Bush leaves office in January.

Turning to the situation along Israel's border with the Hamas-controlled Gaza Strip, Olmert hinted at the possibility of strong Israeli action to try to curb cross-border rocket attacks. Egyptian mediation has failed to produce a truce.

 "The reality on Israel's southern border is intolerable," he said. "While we have no desire to see the uninvolved Palestinian population in Gaza suffer, (and) we will do everything to avoid any humanitarian crisis in Gaza ... we cannot be expected to accept a situation that no other nation in the world would tolerate."    

Olmert said Israel will not shy away from "a large military operation in Gaza if and when we come to the conclusion that this is the best way to restore calm on our southern border, but the fact that no such operation has yet taken place does not imply that we are not taking action."    

The prime minister also spoke in support of Israel's indirect peace talks with Syria under Turkish auspices which have drawn a lukewarm US response.

He said Syria is a threat to regional stability but peace with Israel would force it to disengage from "its allies in the axis of evil," leading to a "drastic, strategic shift in the entire Middle East." -Reuters