George W. Bush with Israeli PM Ariel Sharon, left, at joint news conference

Israel plans to build 50 new homes in the West Bank settlement of Elkana. The announcement came just a week after President Bush met Prime Minister Ariel Sharon and told him that settlement expansion violates the internationally-backed "road map" peace plan.

But Mr. Sharon has made no secret of his strategy - to pull out of the impoverished, overpopulated and violent Gaza Strip, while tightening Israel's grip on West Bank settlement blocs and attaching them to Israel.

Zalman Shoval

"These settlement blocs will remain under Israel's control in final, permanent status negotiations," said Israeli spokesman Zalman Shoval.

The Palestinians are furious.

"I call upon President Bush's direct intervention in order to revoke these Israeli orders, in order to stop these fait accompli policies and dictations, in order to give the peace process the chance it deserves," said Palestinian chief negotiator Saeb Erekat. "The choice at the end of the day is between settlements or peace."

In another development, Israel might delay its Gaza pullout by three weeks, meaning the evacuation of eight-thousand settlers would begin in mid-August. The reason for the delay is that the original target date falls during a three-week mourning period for the destruction of the two biblical Temples. Since most settlers are observant Jews, they are not allowed to move during that period, according to Jewish Law.

But for the settlers, it was hardly a concession.

"Putting it off for three weeks does not stop the edict, it just means it is going to take place three weeks later, and God willing, it will never take place," said Rachel Sapperstein, who lives in the Gaza settlement of Neve Dekalim. "And this is one of the ugliest things that they could possibly do to us, because they are going to go ahead with it anyway."

The settlers say expelling Jews during the mourning period would be more appropriate, because, they say, it is a national disaster they compare to the destruction of the Temples.