[Bill Hemmer, Cnn Correspondent:] Another brutal and bloody day in the West Bank. Meanwhile, Colin Powell says he will meet with Yasser Arafat. Israel says it won't even talk to the Palestinian leader. Will anything get done this weekend? We'll look at that and more. I'm Bill Hemmer. LIVE FROM JERUSALEM begins now.
[Announcer: Live From Jerusalem:] Ambush In The West Bank. The West Bank offensive continues, but, at a price.
[Ariel Sharon, Prime Minister Of Israel:] This is a difficult day.
[Announcer:] Other difficulties, making peace.
[Colin Powell, Secretary Of State:] It is in their interest now to do everything they can to control their passions, to control the violence, to bring it down so that we can get a political process moving.
[Announcer:] See the big picture, such a small space, yet so much conflict. Plus, the view from the street in a land where walls once came tumbling down. They're going back up.
[Unidentified Female:] It wasn't my dream, of course but this is the reality. We live in Israel.
[Announcer: Live From Jerusalem:] Ambush In The West Bank. Now, CNN's Bill Hemmer.
[Hemmer:] And good evening once again from Jerusalem. We come to you tonight where a lot of people thought that partial military withdrawal might bring a slow end to the bloodshed, but tonight you have every reason to think again. Israel suffered perhaps its worst military setback yet, 13 Israeli soldiers killed after they were ambushed in a West Bank battle earlier today. Also, late on Tuesday, Israel was showing off what it believes is solid progress in its current campaign in the West Bank. That's where we begin tonight, in Jenin, and CNN's John Vause.
[John Vause, Cnn Correspondent:] These are the weapons the Israeli military says belong to Palestinian militants and the reason behind the operation on the West Bank, a staggering collection of automatic and semiautomatic rifles, RPGs and mortars, bomb-making equipment found inside a house in the Jenin refugee camp. There's no way to verify the Israeli Army account because the area is closed to journalists. All these pictures were provided by the Israeli Defense Force. This is how the Israelis say they're dismantling the terrorist network. The house was wired with explosives and destroyed. But after a week of fighting, the Israeli losses are beginning to mount. According to the military, a group of reservists were caught in an ambush, a blast from a suicide bomber setting off explosions in nearby homes, which had been booby-trapped. Palestinian gunmen then opened fire on the wounded.
[Sharon:] This is a difficult day. There was a very tough battle between the IDF forces and the terrorist organizations.
[Vause:] In all, 13 Israeli soldiers were killed. Palestinians claim the Israelis set off the explosion, not knowing their own troops were nearby. And the Palestinians say their losses now total more than 150 and hundreds of Palestinian civilians have fled Jenin for Ramallah, looking for shelter. Along Israel's northern border, Israel says Katyusha rockets were fired by Hezbollah militants into the northern Golan Heights. Two missiles landed near civilian settlements, but there were no injuries. Israeli air force and artillery units returned fire. And in the small town of Durah, the Israeli offensive rolls on. Tanks and troops supported by helicopter gun ships on a mission to arrest more suspected militant and seize more weapons, a mission the Israelis say is now complete in two West Bank towns, in Tulkarm and Qalqilya. As the heavy armor and soldiers pulled out, Palestinians began cleaning up after the weeklong occupation. Israel says the pullout is proof they are wrapping up the operation, but at the same time, insisting it will be in their own time, in their own way and without bowing to international pressure. The Israeli prime minister Ariel Sharon says this is a fight for the survival of the Jewish people. John Vause, CNN, Jerusalem.
[Hemmer:] And now, the job for the Secretary of State Colin Powell. He will be here in Jerusalem in about two day's time, but frankly, his job has gotten tougher by the day. We now know Colin Powell will meet with Yasser Arafat, which should make for a pretty interesting picture inside that besieged compound in Ramallah. Israeli troops and tanks still surround the Palestinian leader. Again, Colin Powell will be here in two days. Tonight though, he's in Madrid, Spain, so, too, is Andrea Koppel, traveling with Colin Powell. Here's Andrea now on the day for Colin Powell next soon to be meeting here in the Middle East.
[Andrea Koppel, Cnn Correspondent:] Like an engineer trying to plug a leaky dam before it overflows, Secretary Powell arrived in Cairo eager to win Egypt's support for an IsraeliPalestinian truce, as well as an end to Palestinian terrorism even before a full Israeli withdrawal from West Bank towns and cities is under way.
[Powell:] I would ask all parties now to speak out against this kind of activity. I would ask all leaders of Arab nations, all Palestinian leaders to say to their people and to say to people throughout the world, this is the time to stop this kind of activity.
[Koppel:] But faced with some of the biggest demonstrations Egypt has seen in decades, since it became the first Arab state to sign a peace treaty with Israel in 1979, Egypt's president has already moved to end most official contact with the Jewish state. And echoing statements by other Arab leaders, President Mubarak also told Powell in the words of one Egyptian official, "It takes two hands to wash a face." With Palestinian leader, Yasser Arafat, under siege and most West Bank cities controlled by Israel, Mubarak and his deputy said the next significant move must be Israel's.
[Ahmed Maher, Egyptian Foreign Minister:] Security cannot be achieved through force, through the use of force, but through the creation of an environment that is helpful to create confidence between the parties.
[Koppel:] As proof there's cause for some confidence, U.S. officials point to Israel's sudden decision to allow Arafat's deputies to see him in Ramallah this week and to the beginning of a withdrawal from the West Bank.
[Powell:] Nevertheless, the president hopes that Prime Minister Sharon will end this operation quickly and start to remove the forces now.
[Koppel:] People are more willing to do things in private, explained a senior aide traveling with Powell. [on-camera]: And so, the second day of Secretary Powell's Mid East peacemaking mission ends on a similar note, as did the first, with yet another Arab leader telling the United States the ball is in Israel's court. Andrea Koppel, CNN, Cairo.
[Hemmer:] Now, from the White House tonight where President Bush has said for days now for the Israeli military to withdraw its troops. We saw a partial withdraw again about 24 hours ago from two towns in the West Bank. But still at this point, Ariel Sharon says he is convinced that the military operation is making headway and it will not end until its mission and its goals are met. To the White House now with more reaction from John King, who's there now on the Front Lawn. John, curious to know what these repeated calls from the White House to the Israeli government how are they feeling, knowing in large part, their message has been, frankly, ignored, publicly anyway?
[John King, Cnn Sr. White House Correspondent:] Well, Bill, yesterday, we heard the president's frustration in what he did say. He said he meant it when he asked Prime Minister Sharon to pull back those troops and he wanted it to happen tonight as the frustration, some aides here say irritation as the White House grows. It was how the president didn't say it. He had an appearance here at the White House with the NATO secretary general, Lord Robertson. The two men talking about NATO's coordination with the United States in the war on terrorism. As they finished their statements, a reporter asked the president, "Are you upset with Prime Minister Sharon because he has not heeded your call to pull back the troops?" The president left the room. He clearly heard the question. He refused to answer that question. Top aids say he does not want to get into a daily sparring match with a man he considers to be a friend and an ally, but certainly, a great deal of tension in the relationship right now. U.S. officials saying even privately, that ambush in the West Bank would not have happened had Prime Minister Sharon heeded the president's advice and pulled back his troops Bill.
[Hemmer:] John, we just heard from Andrea Koppel with Colin Powell. How much of his message to the Palestinian leader is to denounce in Arabic to the Palestinian people denounce terrorism and take a cooling off period in order to work anywhere toward a meaningful cease-fire? How much of that is the message in Ramallah letter later this week here?
[King:] We are told, Bill, it will be a very blunt and pointed message. Secretary Powell, number one, will say he is meeting with Mr. Arafat not because the administration believes Mr. Arafat has done what it has asked of him. Remember, not only frustration with Prime Minister Sharon here at the White House. What Secretary Powell will say is, "I am here to meet with you, sir, because you are the leader of the Palestinian people. But we think you should heed our calls to arrest people and hold them when you arrest them, don't just let them go. You must make public statements in English and more importantly, as you noted, in Arabic repeatedly denouncing terror and violence as a tool of your confrontation with Israel." So the administration says, yes, it must meet with Yasser Arafat because he is the leader of the Palestinian people. Yes, Secretary Powell is facing a great deal of pressure from Arab nations to go ahead with that meeting. But President Bush said it perhaps best, representing the White House view. In an interview with the "Wall Street Journal" yesterday, he said, "Some ask me if Mr. Arafat has lost my trust. He has never earned it" Bill.
[Hemmer:] Wow! John, then if Colin Powell is backed into a corner and Yasser Arafat does not heed that message, what's the plan at that point?
[King:] Well, one of the things we are already hearing from the administration, as you noted, the trip has become more difficult by the day, if you will, Secretary Powell's trip. Administration officials who now said the goal was a cease-fire who at the beginning, said the goal was a cease-fire, now saying they cannot even say with any certainty that Secretary Powell will be able to broker a cease-fire. They say that is why it is so important that he meet with the Arab leaders, so important that he meet with the European Union officials and the U.N. secretary-general, he will see in Madrid. They say he has to think about the long-term here in case there is no progress or not enough progress to get a cease-fire in the short-term. So you can see as the violence continues, as the new attack on the Palestinians, the continuing Israeli military offensive, here in Washington and those traveling with Secretary Powell trying to dramatically lower the expectations. They say they can't even guarantee a cease-fire by the time he leaves Jerusalem this weekend.
[Hemmer:] Got it, John. Thank you. John King at the White House. A rainy Washington D.C. John, thanks for your time tonight. Unclear right now if indeed Colin Powell may extend that trip if he feels he's not making any progress. John mentioned a few days on the ground right now on the schedule. We are told that could be extended depending on the amount of progress or the lack thereof. To the U.N. now, east side of Manhattan, in New York City, where the U.N. Security Council, once again, for the second straight day debated the crisis here in the Middle East. Arab countries now pushing for a resolution to put more pressure on Israel to withdraw its troops in the West Bank. The U.S. though says it will veto any resolution saying two things previous resolutions supported by the U.S. have produced nothing on the ground here and Colin Powell, they say, needs time on the ground to talk with both parties, Yasser Arafat included there. Meanwhile, more harsh words from Iraq today. From Baghdad, yesterday, it said it would suspend oil production for one month's time. Today, the U.N. says at two loading terminals, they saw no oil being pumped, one in the Persian Gulf, and the other one in Turkey. Baghdad, today, he says the U.S. will be punished for its support of Israel.
[Gen. Amer Rasheed, Iraqi Oil Minister:] We have to have to harm the American economy in one way so that the American administration will realize that supporting Zionist regime, it also will suffer economically.
[Hemmer:] To date, no other Arab countries have followed Saddam Hussein's lead on this. Oil industry analysts say if no other countries do, the net effect of Iraq's move basically will amount to nothing. We'll be back. LIVE FROM JERUSALEM continues in a moment here.
[Announcer:] Coming next, perspective, a world of conflict in an area the size of New Hampshire. Plus, another view, how the world media is reporting the ongoing crisis.