A United States envoy, Anthony Lake, is in the Eritrean capital Asmara in a new attempt to resolve the seven month border dispute with Ethiopia.

The peacemaking mission is Mr Lake's third to the region, where fighting erupted in May in an escalation of the row.

As part of this latest effort, the envoy met the Ethiopian Prime Minister, Meles Zenawi, in Addis Ababa on Friday.

In Washington, the State Department said it believed progress was possible, warned of grave consequences if a peaceful solution wasn't found soon.