jerusalem | How to turn the disaster of the radical Hamas’ capture of Gaza into a political opportunity was the main focus of this week’s four-way summit in the Egyptian resort town of Sharm el-Sheik.

Egyptian President Hosni Mubarak, Jordanian King Abdullah, Palestinian President Mahmoud Abbas and Israeli Prime Minister Ehud Olmert all expressed hope for a renewed Israeli-Palestinian peace process now that Abbas has set up a moderate, Fatah-led government without Hamas.

The subtext was clear: A vibrant Israeli-Palestinian peace process could help stop the radical, Iranian-backed power that Hamas represents — and that all four leaders fear — from spreading.

But although they agreed on the general direction and even on some of the specifics, there were major differences on a number of key issues.

Mubarak, for example, spoke of the urgent need for Fatah and Hamas to reconcile. The Palestinians, he said, need to speak with a united voice. But a new Fatah-Hamas deal is precisely what Olmert does not want to see.

He fears the return of Hamas would undermine any chance for a genuine Israeli-Palestinian dialogue. And he is worried that Abbas could be pressured into striking a new deal with the radicals.

More significantly, although Mubarak, Abdullah and Abbas all want to see accelerated talks on a final Israeli-Palestinian peace deal, Olmert has his doubts. He sees the split between Gaza and West Bank as making the conflict easier to manage but more difficult to resolve.

Olmert favors a more careful, step-by-step approach that gradually would create conditions for a final settlement rather than making a gigantic leap toward a peace accord that would likely fail.

But the Palestinians want final status talks to start now. Nimmer Hamad, one of Abbas’ top advisers, told Israel Radio it’s time Olmert recognizes Abbas as a genuine peace partner.

Hamad said Abbas would disarm all militia groups, including Fatah’s own Al-Aksa battalions, to create conditions for peace talks. If there is no “political horizon,” he warned, extremism will grow.

Israeli Foreign Minister Tzipi Livni and U.S. Secretary of State Condoleezza Rice are sympathetic to that position. They agree that Israel and the Palestinians should negotiate a final status agreement even if it cannot be implemented for some time.

American and Israeli diplomats call it a “shelf agreement” ready to be taken down and implemented as soon conditions allow. Such an agreement would be a strong incentive for Palestinians to get their act together, they say.

Olmert, however, is adamantly opposed to cutting such a deal. He argues that a deferred agreement would only invite pressure on Israel to make further concessions to see it enacted.

Given the readiness on the Arab side to go for a final peace deal, and the realization that a true political horizon for the Palestinians would be the best way to strengthen Abbas and the moderate cause, the international community may press for it.

The diplomatic quartet of the United States, the European Union, Russia and the United Nations appointed outgoing British Prime Minister Tony Blair as its special Middle East envoy, and he may well focus on getting this shelf agreement.

In the meantime, Olmert intends to go ahead with confidence-building measures. At the summit he did what no Israeli prime minister has done before in such strong terms: He delivered an impassioned recognition of Palestinian suffering.

“We are not indifferent to your suffering, and we are ready to take steps to bring it to an end,” he declared.

Olmert went on to announce that he intends to release 250 Fatah prisoners as a goodwill gesture.

The Israeli leader is also considering steps to improve the quality of Palestinian life in the West Bank.”We will work with this government which recognizes Israel, accepts previous agreements and rejects violence” to “create political opportunities and a better life,” he said.

Olmert’s policy toward the Hamas regime in Gaza will be the opposite. Although Israel will allow the flow of humanitarian aid into Gaza, it will do all it can to isolate the Hamas government.

Now, as Olmert and Abbas make progress, the question is: Will Hamas be ready to actually bring about Shalit’s release to alleviate its growing isolation?

Hamas releases Shalit audiotape

Hamas stole the headlines away from the Arab-Israeli summit this week by issuing the first audiotape of Gilad Shalit, a kidnapped Israeli soldier held in Gaza for exactly a year.

Shalit, a 20-year-old conscript promoted to sergeant in captivity, read from a text that was posted on the Internet and sounded as though it had been written by a Palestinian psychological warfare team.

“I regret the lack of interest shown in me by the Israeli government and the IDF,” Shalit said, adding that the Olmert government should heed Hamas’ ransom demand of a mass release of Palestinian prisoners.

He complained: “My medical condition is deteriorating, and I need to be admitted to a hospital.”

Shalit’s family quickly vouched for the authenticity of the tape, though there was no way of knowing when it was made. — jta