Kerry extends Mideast peace mission

US Secretary of State John Kerry extended for a third day on Saturday his shuttle diplomacy between Israeli and Palestinian leaders, raising speculation of progress in reviving long dormant peace talks.

In a commute to which he has grown accustomed, Kerry will take a helicopter from Jerusalem to Amman to see Palestinian president Mahmud Abbas before returning in the evening to follow up with Israeli leaders.

In a potential sign of headway, Kerry cancelled a dinner he had scheduled for Saturday night in Abu Dhabi, part of his separate tour in the past week through Gulf Arab states to coordinate support for rebels in Syria's civil war.

Kerry spoke by telephone with the UAE foreign minister, Sheikh Abdullah bin Zayed al-Nahayan, to convey his regrets about the cancellation and to tell him that he hoped to visit at a later date, State Department spokeswoman Marie Harf said.

Harf said that Kerry would still head to a meeting of Asian ministers in Brunei starting on Monday but called off the Abu Dhabi stop because his "meetings on the peace process remain ongoing".

It was a rare public comment on Kerry's talks, with US officials saying that they planned to keep quiet about all discussions behind closed doors due to the fluid diplomacy. Kerry is likely to speak before leaving the region.

Kerry has spent seven hours since Thursday sounding out Israeli Prime Minister Benjamin Netanyahu. Their two evening meetings took place at a hotel suite with sweeping views of Jerusalem named after slain Israeli peacemaker Yitzhak Rabin.

Kerry's aides have played down expectations of an imminent breakthrough and instead are hoping to make incremental progress to set the stage for substantive negotiations between Israel and the Palestinians.

The two sides have not formally met for peace talks since September 2010 and even then the negotiations broke down quickly, with Abbas saying that Israel was not serious about a discussion on the future.

The Palestinian Authority wants Israel to freeze construction of Jewish settlements on occupied land and to promise that any negotiations will be based on the principle of Israel withdrawing from land seized in the 1967 Six-Day War.

Netanyahu has rejected such "pre-conditions" but insists he remains ready to talk.

Kerry, following his second meeting with Netanyahu, went to dinner with Israeli President Shimon Peres, who now holds a largely ceremonial role but who was identified with the peace process while prime minister.

The nearly 90-year-old Peres, welcoming Kerry at his official residence full of memorabilia from the decades-old peace process, acknowledged that "it is difficult, there are many problems" in moving forward.

"But as far as I'm concerned I can see how (among) people, there is a clear majority for the peace process, a two-state solution, and a great expectation that you will do it and that you can do it," Peres told him.

In a sign of Kerry's desire to keep negotiating, he was paying a rare visit to Jerusalem during Shabbat, the weekly sabbath when observant Jews stop work and refrain from the use of electricity.

Kerry arrived just before sundown to see Peres, with aides warning that the two would have been obliged to cancel a photo opportunity after the sabbath began at around 7:15 pm (1615 GMT).

The secular-minded Peres, realising that they were cutting it close, quipped that the sabbath began at 7:30 pm in Tel Aviv and said: "Let's do a Tel Aviv Shabbat."

Despite the upbeat words of Peres, a recent poll showed scepticism among Israelis about the peace process. Netanyahu, never a peacenik, emerged from January elections with a coalition even more hesitant about negotiations.

Economy Minister Naftali Bennett, who heads the far-right Jewish Home party, recently described the Palestinian issue as "shrapnel in the buttocks" -- a problem Israel simply had to keep suffering through -- but threatened to quit if the government agreed to a Palestinian state.

Abbas, whose rule is effectively confined to the West Bank, also faces Palestinian divisions.

Ismail Haniya, the Gaza-based prime minister of the rival Hamas movement, warned Abbas on Friday not to fall into the "trap of negotiations".