WASHINGTON, Nov 11: US President George W. Bush said on Thursday that Palestinian leader Yasser Arafat's death 'provides a rare opportunity' for peace in the Middle East and promised to seize on the opening.

Speaking hours after Arafat's death, Mr Bush hoped that a new Palestinian leadership would enhance the opportunity of reaching peace in the Middle East.

Last week when Arafat was brought to Paris for treatment, the US president had said that chances for peace would increase if the Palestinian leader died. And after Arafat's death was announced, Mr Bush stressed that there would be 'an opportunity for peace' when the new Palestinian leadership assumed its responsibility.

In a statement issued by the White House, the president expressed condolences and urged world leaders to join in the push for a resolution of the conflict.

"We hope that the future will bring peace and the fulfilment of the aspirations for an independent democratic Palestine that is at peace with its neighbours," he said.

On Wednesday afternoon Mr Bush had indicated that deeper US engagement in the Middle East peace process was imminent. He said he saw an 'opening for peace' and if the new Palestinian leadership requested assistance, the US "will be more than willing to help build the institutions necessary for a free society to emerge".

A senior US official told reporters in Washington that President Bush had come to understand that much of the opportunity depended on how the US administration responded in the first days and weeks after Arafat's death. A battle between radical and moderate elements within the Palestinian society appeared certain to emerge, and a direct US involvement might ensure that moderate leadership took hold in the Palestinian Authority, he said.

Another official said the US was prepared to help the Palestinians hold polls to elect a new president, which under the Palestinian law must take place in 60 days, now that the Palestinian president is dead.

US officials also say that a renewed US effort at peacemaking in the Middle East might help mend frayed relationships with America's European allies.