The Israeli occupation army arrested seven Palestinians, including wanted Islamic Jihad resistance leader Fayez Tubassi, during a sweep of the West Bank village of Al-Araqa. Dozens of occupation army vehicles and jeeps briefly rolled into Al-Araqa, west of the northern city of Jenin, Palestinian security sources said Friday. The sources also told a news agency reporter that one house had been set on fire by the occupation soldiers.

The occupation army confirmed it had arrested Tubassi, who is accused of helping plan car bombings in northern Israel in June and last week that left 31 Israelis dead.

The occupation army also said it had arrested 29 wanted resistance activists in Jenin since Thursday.

The occupation army has reoccupied most of the West Bank since mid-June in a bid to foil resistance bombings and has poured occupation troops into Jenin since October 25 in an operation to catch resistance activists.

PERES & PALESTINIANS HOLD TALKS

Former Israeli Foreign Minister Shimon Peres sat down with Palestinian officials on a Spanish island on Friday to discuss the state of the Middle East peace process after the fall of Israel's coalition government.

Peres and Israeli Parliament speaker Avraham Burg sat immersed in conversation with chief Palestinian negotiator Saeb Erekat and former Palestinian Authority national security adviser Mohammed Dahalan on Friday evening on the sidelines of a seminar at a secluded hotel at Formentor on the Mediterranean island of Mallorca.

Peres was among six Labour ministers who resigned from Israeli Prime Minister Ariel Sharon's national unity coalition this week in a dispute over funding for Jewish settlements.

But he kept an appointment to speak at the Formentor Forum, an annual seminar on political and social issues that brings together politicians, business executives, academics and journalists.

SHADOW OF IRAQ

"A great deal depends also on the energies of the Quartet, the investment of the United States, the priority given to Iraq.

Let's not forget that the whole situation is overshadowed by the very serious issue of Iraq," Peres said.

The Quartet -- made up of the United States, European Union, United Nations and Russia -- has been trying to mediate in the Israeli-Palestinian conflict, but much of Washington's diplomatic focus has recently been on Iraq which it accuses of developing weapons of mass destruction.

Peres said it was not yet clear whether there would be a narrow government or early elections in Israel. "The difference is not tremendously great because normally we have to have elections by October 2003," he said.

In Israel, cabinet minister Danny Naveh said Sharon would begin formal talks on Sunday with prospective partners in a narrow government following the collapse of his broad coalition.

Ultranationalists who oppose trading occupied land for peace and support unlimited Jewish settlement on territory Israel seized in the 1967 Middle East war are among those Sharon will be courting.

PHOTO CAPTION

Israel's Peres and Palestinians hold talks - Chief Palestinian negotiator Saeb Erekat (L) and Israeli Foreign Minister Shimon Peres meet in Palma de Mallorca on November 1. REUTERS/Dani Cardo