Bush's Middle Eastern bucket list end upbeat despite sceptics.

SHARM EL SHEIKH, Egypt (AFP) — US President George W. Bush was upbeat as he ended his Middle East tour Wednesday, saying he was optimistic an Israeli-Palestinian peace deal can be reached despite failing to win full Arab backing for his efforts.

He also left the region after eight days without wholehearted support from key Arab allies in the oil-rich Gulf for his campaign to isolate Iran, which he has repeatedly branded a "threat to world peace."

"When I say I am coming back to stay engaged I mean it, and when I say I am optimistic we can get a deal done I mean what I am saying," he told reporters in the Red Sea resort Sharm el-Sheikh after meeting Egyptian President Hosni Mubarak on the last and briefest leg of his tour.

Bush, who is anxious to end his presidency with a foreign policy triumph, predicted in Jerusalem at the start of his trip that a peace treaty would be signed by the time he leaves office in January 2009.

He also urged his key Arab allies to 'reach out to Israel" to help promote the peace negotiations that were revived amid great fanfare only at the end of November but which have been overshadowed by a new explosion of violence in Gaza.

But his appeal received a lukewarm response from staunch US ally Saudi Arabia, with Foreign Minister Saud al-Faisal saying: "I don't know what more outreach we can give to the Israelis."

Bush also used his trip to promote democracy in a region where few in power are directly elected, and to win backing for Washington's view that Iran poses "a threat to world peace" and should not be allowed to develop the know-how to build a nuclear weapon.

"I am absolutely confident that people in the Middle East are working hard to build a society based upon justice," he said on his three-hour stop in Sharm El-Sheikh, where he was greeted without ceremony in a sign of cooling ties between the two allies.

After meeting Mubarak, Bush again took aim at Iran -- this time over its alleged interference in Lebanon -- and called on Egypt to take a leading role in boosting democracy in the region.

Speaking a day after three people were killed in a Beirut street when a US embassy car was targeted by a bomb, Bush told Tehran and its close regional ally Syria to stop "interfering" in the affairs of Lebanon and urged the country to vote for a new president.

As he headed home, Bush took questions online for the firt time on his "Ask the White House" website, saying he had left Lebanon off his itinerary because he did not want to "distract from the delicate political process" there.

While saying he was "committed to democracy in Lebanon," he claimed Syria "continues to try to subvert the outcome of the Lebanese political process from the outside."

In Saudi Arabia, Bush said he hoped OPEC would boost output to help ease recession fears at home because "very high" prices -- which briefly hit 100 dollars at the start of the year -- were tough on the US economy.

His remarks sent market prices down sharply, even though the cartel's secretary general responded by saying there was no supply shortage. OPEC is due to meet in Vienna on February 1.

In Saudi Arabia, Bush also faced difficulty in convincing his hosts to show a willingness to confront the "threat" of Iran.

"Iran is a neighbouring country, an important country in the region. Naturally we have nothing bad against Iran," Faisal said.

Saudi Arabia, like other Gulf states, is determined to avoid further conflict after the 2003 US-led invasion of Iraq, which served to strengthen the regime in Tehran.
Bush reiterated his warning that "all options are on the table" over Iran, and said he had asked King Abdullah and other Gulf leaders to do more to pressure Tehran over its contested nuclear programme.

"They need to help. They need to make it clear to nations that do business with Iran that if we want to solve this diplomatically, there needs to be pressure on the regime."

Yet as Bush was heading home, only days after a stop in Kuwait, that country's foreign minister was in Tehran expressing friendship with the Islamic republic.

"I can only speak on my government's behalf," Sheikh Mohammed Sabah al-Salem al-Sabah said at a news conference with his Iranian counterpart, Manouchehr Mottaki. "My country knows who is our friend and who is our enemy, and Iran is our friend."

Sweetening Bush's visit to Riyadh, the State Department announced that his administration has notified Congress of its intention to sell 900 satellite-guided bombs to Saudi Arabia for 120 million dollars, the first part of a planned 20-billion-dollar deal with the Gulf.

US relations with Egypt have faltered over Washington's criticism of Cairo's perceived failure to secure its border with the Gaza Strip and its record on political reforms.

Both Rice and Israel have urged Cairo to do more to stop arms smuggling into the impoverished Palestinian territory, now run by the Islamist Hamas movement regarded as a terror group by Israel and the West.

The US Congress last month froze 100 million dollars in aid until Rice could certify that Cairo was doing enough to stem the arms flow.

Egypt, the most populous Arab country, was also the first Arab state to sign a peace treaty with Israel in 1979 and has frequently acted as a peace mediator, but relations remain tense.

On Wednesday, protesters set fire to American flags in Cairo and the opposition Al-Ahaly newspaper told the US leader simply to "Get out."

Despite Bush's confident prediction in Jerusalem last week of a signed peace treaty within a year, the conflict suffered its deadliest single day of violence in 12 months on Tuesday when Israeli troops killed 19 Palestinians in the Gaza Strip.

And as Bush left for home, violence continued with three members of the same family killed in an Israeli air strike on Gaza. The army said it had killed civilians "in error" while targeting militants.

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