It is the first time US officials have been killed in the intifida
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President George W Bush has led international calls for the Palestinian Authority to crack down on militants following the bomb blast on a US convoy that killed three US embassy personnel in the Gaza Strip.
Mr Bush blamed the attack on the Palestinian Authority's "failure to create effective Palestinian security forces dedicated to fighting terror" and Palestinian leader Yasser Arafat in particular.
Two other major players in the search for Middle East peace - the United Nations and the European Union - have also urged Palestinians to take urgent action.
Yasser Arafat has condemned "this ugly crime" and set up a commission of inquiry - but EU foreign policy chief Javier Solana said, through a spokesperson, that "condemnations and excuses will not do".
In an interview with the BBC Mr Arafat said the attack was a shameful, dirty and very serious act against friends of the Palestinian people.
US Secretary of State Colin Powell told the BBC the attack would not deter Washington from pursuing the peace plan known as the roadmap.
But he said that progress towards peace depended on the Palestinian Authority forming a government quickly and giving it full powers to take over the security structure and find the people responsible for what he called acts of terrorism.
FBI probe
The US embassy convoy was on its way to interview people for a scholarship in the US when it was hit by what is believed to have been a remotely-detonated roadside bomb just inside Gaza.
Two of the victims - described as security contractors - died outright, the third afterwards and the fourth was in a stable condition.
Two of the main Palestinian militant groups, Hamas and Islamic Jihad, have said they were not involved in the blast.
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Reforms... continue to be blocked by Yasser Arafat
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The American FBI is on its way to investigate the incident. All American citizens in the Gaza Strip were advised to leave the area.
In the US, the shock of American casualties in Gaza will only strengthen public sympathy for Israel and for Prime Minister Ariel Sharon's hardline stance, says the BBC's Adam Brookes in Washington.
It is becoming harder and harder for the Americans to act as moderators in the Middle East peace process, our correspondent says.
Reforms blocked
In a statement, Mr Bush said the US was working to bring those responsible to justice, but stopped short of threatening any specific action, says the BBC's Rob Watson who is travelling with President Bush and is in Fresno, California.
He said the Americans who were attacked were going to help Palestinians build a better future.
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Shrapnel from body parts and debris from damaged M-16s [assault rifles] were scattered everywhere
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"Palestinian authorities should have acted long ago to fight terror in all its forms," Mr Bush said.
"There must be an empowered prime minister who controls all Palestinian forces - reforms that continue to be blocked by Yasser Arafat."
It is not clear whether the easily identifiable convoy was deliberately targeted.
It is the first time officials from the United States, the leading mediator in the conflict, have been killed in the three-year intifida.
The United Nations envoy to the Middle East Terje Roed-Larsen described the event as an "ominous widening of the conflict".
Israeli Foreign Minister Silvan Shalom said the attack showed the Palestinian Authority continued "to cover for the extremist organisations".
Wednesday's blast came just hours after the US - Israel's closest ally - vetoed a United Nations Security Council resolution condemning Israel's controversial West Bank barrier.
The draft, introduced by Arab states, declared that the structure was illegal under international law and that construction must be halted.