The Palestinian leader, Yasser Arafat, has accused Israel of reneging on Middle East peace commitments, and has called off the latest round of talks.

Mr Arafat said that Jewish settlements were expanding more under the government of Ehud Barak than under the previous one, and were the most serious problem his people faced.

"There has been no accurate, honest implementation of what was signed between us and Barak himself," Mr Arafat said after talks with Egyptian President Hosni Mubarak in Cairo.

Mr Barak and Mr Arafat failed at a summit on Thursday to resolve land issues at the heart of the negotiations.

A spokesman for the Palestinian leader said: "The situation is dangerous because despite the efforts of the United States the crisis is continuing."

Egyptian Foreign Minister Amr Moussa told reporters that Mr Arafat had described talks with Israel as "absurd".

And a senior Palestinian official said the negotiations could not proceed until the US intervened.

"We are waiting for the Americans, nothing can happen until they come back with responses," Yasser Abd Rabbo said.

Barak 'determined'

Both sides presented their differences over further Israeli withdrawals from occupied land to US Middle East envoy Dennis Ross on Saturday.

Israeli officials refused to confirm whether Sunday's session had been cancelled.

It was to have been the seventh of 10 days of marathon talks aimed at producing an outline of a final peace agreement by 13 February. Both sides concede this deadline is likely to be missed.

But Mr Barak, in Amman to meet Jordan's King Abdullah, said Israel was determined to move peace talks with Syria and the Palestinians forward despite difficulties on both tracks.

"I think it is our responsibility with the Palestinians to get to a solution," he said.

Following the meeting, King Abdullah dispatched an envoy to Cairo to brief the visiting Palestinian leader.

According to Israel radio, Mr Barak also told reporters in Amman that Lebanon's Hezbollah guerrilla group would pay a heavy price for its deadly attacks on Israeli troops in south Lebanon.

He was speaking as reports from Lebanon said one Israeli soldier was killed and six wounded in a bomb attack on Sunday.

Levy: 'No crisis'

Earlier, Israeli Foreign Minister David Levy responded to the Palestinian accusations, denying there was a crisis in the talks, and saying Israel wanted to reach a permanent accord this year.

Speaking before entering discussions over the return of Palestian refugees, Mr Levy said: "There is no crisis, there are debates."

Mr Levy, who is in Cairo to meet Egyptian, Palestinian and Jordanian representatives to discuss the plight of hundreds of thousands of Palestinians displaced by the 1967 Arab-Israeli war, said he would not rule out trying to end the deadlock.

The talks are one of the most contentious issues in the Middle East peace process and had been suspended since 1996.

The meeting is part of the efforts to formulate a final settlement in the Middle East peace process.