Custodian of the Two Holy Mosques, U.S. President Obama discuss in Saudi Arabia regional developments, Palestinian issue, furthering bilateral ties

King Abdullah decorates President Obama with King Abdulaziz Medallion

Obama: I came to the cradle of Islam seeking King Abdullah's advice

U.S. President stresses plans to resume negotiations to realize peace in region

The Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz Al Saud and U.S. President Barack Obama co-chaired the official talks held between the two sides at the king's ranch at Al-Janadriyah.

At the beginning of the session, the king decorated Obama with King Abdulaziz Medallion for which the US president thanked the king.

Obama said that his visit is the first to the kingdom and that there were a lot of talks and a previous meeting with the king. He added, "I always listen to the king, to his wisdom and generosity. The United States of America and the Kingdom of Saudi Arabia have long history of friendship and the relations they have are strategic relations."

He added, "This tour which I start in the Middle East region in Riyadh and Cairo was very important that I start the visit with the Kingdom of Saudi Arabia, which is the cradle of Islam ... I will listen to the advices of the Custodian of the Two Holy Mosques on many issues which we face together and I would like to thank him again for his personal generosity and hospitality. I am sure that it is possible to work together, the Kingdom of Saudi Arabia and the United States of America, to make progress in all issues we face."

For his part, the Custodian of the Two Holy Mosques thanked the US president saying, "I thank the president for this visit and for this complement. This is not strange to the Kingdom of Saudi Arabia and the US because the US is a friend of the Kingdom of Saudi Arabia since the time of King Abdulaziz and President Roosevelt. My greetings to the friendly US people represented by a person who deserves this position and thank you."

Then, discussions focused on the regional and international developments topped by the Palestinian issue and Saudi-US cooperation in all fields.

It is expected that the two leaders will continue their talks later on these issues and a number of other issues including the world financial crisis.

The talks were attended Prince Naif bin Abdulaziz, the Second Deputy Premier and Minister of Interior; Prince Saud Al-Faisal, Minister of Foreign Affairs; Prince Sattam bin Abdulaziz, Acting Governor of Riyadh Region; Prince Ahmad bin Abdulaziz, Deputy Minister of Interior; Prince Miqren bin Abdulaziz, Chief of General Intelligence, and a number of US senior officials.

King Abdullah received U.S. President Obama at the king's ranch at Al-Janadriyah.

During the meeting, they continued discussion of a number of topics of interest to the two sides.

Gingerly trying to advance Mideast peace, President Barack Obama on Thursday challenged Israel to stop settlement construction in the West Bank of the Jordan River on the same day the Israelis rejected that demand.

Obama pushed Palestinians for progress, too, deepening his personal involvement.

"I am confident that we can move this process forward," Obama said after meeting with Palestinian President Mahmoud Abbas at the White House.

The president said that means both sides must "meet the obligations that they've already committed to" - an element of the peace effort that has proved elusive for years.

Abbas said after the session with Obama no meetings with Israeli Prime Minister Benjamin Netanyahu are on the horizon. He said there are no preconditions for such a meeting but "obligations" on Israel through the so-called road map for ending the Israeli-Palestinian conflict.

Abbas said he is meeting his commitments under the road map and Israel should do the same. He cited halting settlement construction as a commitment Israel is not meeting.

Earlier in the day, Israel rejected blunt U.S. requests to freeze Jewish settlement construction on the West Bank, a territory that would make up the Palestinian state, along with the Gaza Strip, as part of a broader peace deal.

In strong language, U.S. Secretary of State Hillary Clinton said Wednesday that Obama wants a halt to all settlement construction, including "natural growth." Israel uses that term for new housing and other construction it says will accommodate the growth of families living in existing settlements.

Israeli spokesman Mark Regev responded Thursday by saying some construction would go on.

"Normal life in those communities must be allowed to continue," he said, noting Israel has already agreed not to build new settlements and remove some tiny, unauthorized settler outposts. Regev said the fate of the settlements would be determined in peace negotiations with the Palestinians.

With that as a backdrop, Obama said part of Israel's obligations include "stopping settlements." But he also struck a hopeful tone.

He said he had pressed Netanyahu on the settlement matter just last week at the White House, and the Israeli leader needs to work through the issue with his own government.

"I think it's important not to assume the worst, but to assume the best," Obama said.

The president also pushed Palestinians to hold up their end, including increased security on the West Bank to give Israelis confidence in their safety.

Obama said he told Abbas the Palestinians must find a way to halt the incitement of anti-Israeli sentiments that are sometimes expressed in schools, mosques and public arenas.

"All those things are impediments to peace," Obama said.

The Palestinian leader said "we are fully committed to all of our obligations" under the road map.

Doing so, Abbas said, is "the only way to achieve the durable, comprehensive and just peace that we need and desire in the Middle East."

Obama, like predecessor George W. Bush, embraces a multifaceted Mideast peace plan that calls for a Palestinian state alongside Israel.

The president refused to set a timetable for such a state but also noted he has not been slow to get involved in meeting with both sides and pushing the world for help.

"We can't continue with the drift, with the increased fear and resentment on both sides, the sense of hopelessness around the situation that we've seen for many years now," Obama said.

"We need to get this thing back on track."

Abbas is working to repackage a 2002 Saudi Arabian plan that called for Israel to give up land it has occupied since the 1967 war in exchange for normalized relations with Arab countries. Abbas gave Obama a document that would keep intact that requirement and also offer a way to monitor a required Israeli freeze on all settlement activity, a timetable for Israeli withdrawal and a realization of a two-state solution.

"The main purpose of presenting this document to President Obama is to help him in finding a mechanism to implement the Arab peace initiative," Abbas said.

Asked about his impression of the meeting with Obama, Abbas said: "It was a serious and open meeting and President Obama seems determined on what he has said to us and to Israeli Prime Minister Netanyahu about the necessity of implementing the road map, and we have agreed to continue our communications."

Palestinian negotiator Saeb Erekat said Obama affirmed to Abbas that Israel has an obligation to freeze settlement expansion, including natural growth.

The United States and much of the world consider the settlements an obstacle to peace because they are built on captured land the Palestinians claim for a future state. But successive U.S. administrations have done little to halt settlement activity.

Now more than 120 settlements dot the West Bank and Palestinian officials say their growth makes it increasingly impossible to realize their dream of independence. More than 280,000 Israelis live in the settlements, in addition to more than two million Palestinians on the West Bank. An additional 180,000 Israelis live in East Jerusalem, where the Palestinians hope to establish their capital.

"I want to use the occasion to deliver a broader message about how the United States can change for the better its relationship with the Muslim world," Obama said of his Egypt speech.

"That will require, I think, a recognition on both the part of the United States, as well as many majority Muslim countries about each other, a better sense of understanding and I think possibilities to achieve common ground."

He praised the United States' long strategic relationship with Saudi Arabia on Wednesday and said his visit was to seek King Abdullah's advice before making his much-heralded speech to the Islamic world in Cairo.

"I thought it was very important to come to the place where Islam began and to seek his majesty's counsel and discuss with him many of the issues that we confront here in the Middle East," Obama told reporters as he met with the king at a farm near Riyadh.

Obama's meeting and scheduled speech in Cairo on Thursday drew condemnation from al Qaeda leader Osama bin Laden, who said in a taped message aired by Al Jazeera television that the U.S. leader had planted seeds for "revenge and hatred" toward the United States in the Muslim world.

The message, which aired shortly after Obama's arrival in the kingdom, came a day after bin Laden's deputy, Ayman al-Zawahri, called Obama a criminal and warned Muslims not to fall for his polished words, part of a propaganda effort to pre-empt Obama's Cairo speech.

After sipping Arabic coffee at an airport welcome ceremony, Obama traveled to the king's farm for talks expected to cover the Arab-Israeli conflict, U.S. overtures to Iran and oil.

Obama praised the king's "wisdom and graciousness," noting that the two countries have a long history of friendship and a strategic relationship. Abdullah thanked Obama and noted that close ties between the two countries go back to President Franklin Delano Roosevelt and King Abdulaziz.

"I am confident that, working together, the United States and Saudi Arabia can make progress on a whole host of issues of mutual interest," Obama said.

The meetings between Abdullah and Obama, which were expected to cover the Arab-Israeli conflict, U.S. overtures to Iran and oil prices, came on the eve of the U.S. leader's speech in Cairo.

Obama, whose father was Muslim and who lived in Indonesia as a boy, hopes to mend a U.S. image damaged by Bush's wars in Iraq and Afghanistan and the treatment of U.S. military detainees.

"I am confident that we're in a moment where in Islamic countries, I think there's a recognition that the path of extremism is not actually going to deliver a better life for people," Obama told NBC News before he left Washington.

King Abdullah was expected to express his worries that Obama's diplomatic outreach to Iran may re-jig regional relationships at Riyadh's expense, diplomats and analysts say.

Saudi Arabia wants Obama to get tough with Israeli Prime Minister Benjamin Netanyahu, who has balked at Palestinian statehood and rebuffed U.S. calls to halt settlement building.

Obama has hinted he would like Saudi Arabia, the birthplace of Islam, to offer some confidence-building measures to Israel.

"I think we have not seen a set of potential gestures from other Arab states, or from the Palestinians, that might deal with some of the Israeli concerns," he told the BBC.

King Abdullah sponsored a 2002 peace plan offering Israel collective Arab recognition in return for an Israeli withdrawal from land occupied in the 1967 war, a Palestinian state with Jerusalem as its capital and a just solution for refugees.

The Saudi adviser said it was "completely unrealistic" to expect any concession from Riyadh, at least until Israel stopped all settlement expansion and accepted the Arab peace plan.

Washington hopes Saudi Arabia will play a moderating role in the Organization of Petroleum Exporters (OPEC) after oil prices hit a seventh-month high, threatening Obama's efforts to lift the United States out of recession and hasten global recovery.

Obama has said he would discuss oil with King Abdullah and would argue that price spikes are not in Saudi interests.

On Monday, the Saudi cabinet reiterated it saw "the fair price" at $75-$80 a barrel -- 17 percent above current levels.

Saudi Arabia, the world's biggest crude exporter, has a nearly 60-year-old bond with the United States based on assured oil supplies in return for U.S. protection for the kingdom.

Saudi Arabia, which has more than a fifth of global crude reserves, wants to hear how serious Obama is about plans to lower U.S. dependence on Middle East oil and diversify energy resources away from fossil fuels, analysts say.