Stabbing attack in Tel Aviv

The attack occurred near a Tel Aviv beach-front bar

A Palestinian man has stabbed three people in Tel Aviv, in what police describe as the first case of political violence in an Israeli city since Palestinian groups declared a truce in June.

One of the victims later died in hospital.

The attacker was shot in the leg and restrained by security guards from a nearby restaurant until police arrived.

The man, reported to be a 23-year-old resident of East Jerusalem, told investigators that he is a member of the al-Aqsa Martyrs' Brigades.

The group, an offshoot of Yasser Arafat's Fatah movement, has not signed up to a ceasefire declared last month by several of the leading Palestinian militant groups.

It has claimed responsibility for a number of shootings against Israeli targets in Palestinian areas since Hamas, Islamic Jihad and Fatah announced a three-month ceasefire on 29 June.

Guard stabbed

There are some violations of the truce, and we will deal with them in accordance with the law Palestinian Prime Minister Mahmoud Abbas Leaders close rift

The assailant first injured a security guard who prevented him from entering a bar, police said.

He then fled and stabbed two passers-by, injuring one of them seriously, before being shot in the legs by another guard.

On Monday Palestinian Prime Minister Mahmoud Abbas said: "Unfortunately there are some violations of the truce, and we will deal with them in accordance with the law."

Israel has demanded a crackdown on the militants and the US-backed peace plan calls for the violent groups to be disarmed.

However, Mr Abbas, also known as Abu Mazen, has preferred to maintain order by securing a ceasefire from militant groups, rather than through outright confrontation.

Agreement with Arafat

On Monday evening he said he had settled his differences with Yasser Arafat at talks at the Palestinian leader's headquarters in Ramallah.

The two men were meeting for the first time since Mr Abbas offered to resign from the Central Committee of Mr Arafat's Fatah Movement last week.

The prime minister had demanded that the movement endorse his handling of contacts with Israel.

Some Arafat supporters had said Mr Abbas had been too soft in peace talks with Israel, particularly on the issue of releasing Palestinian prisoners.

In London, the British foreign secretary, Jack Straw, said Britain would continue to deal with Yasser Arafat, despite an appeal by the visiting Israeli prime minister, Ariel Sharon, not to do so.