MIDDLE EAST peace hopes were all but extinguished last night after a new cycle of tit-for-tat violence claimed the lives of at least 26 Israelis and Palestinians.

One day after the Israelis attempted to assassinate a top Hamas leader, a suicide bomber from that group blew up a crowded bus in central Jerusalem, killing at least 16 passengers and wounding more than 60 others. It was the worst suicide bombing in months. Within an hour an Israeli helicopter had fired missiles at a car in Gaza City, killing a top Hamas commander and six others.

The violence erupted just a week after President Bush had secured pledges of support for the international “road map” to peace from Ariel Sharon and Mahmoud Abbas, the Israeli and Palestinian Prime Ministers. The attacks left that initiative in tatters, and Mr Bush looking powerless. Last night he urged all nations to cut off financial support for terrorists and to “isolate those who hate so much that they are willing to kill”.

The only glimmer of hope came when Yassir Arafat, the Palestinian Authority chairman, went on television to denounce the suicide bomb as a “terrorist operation”. It was the first time he had used the word “terrorist” in connection with a Palestinian attack.

Siding with Mr Abbas, Mr Arafat appealed for an end to attacks on Israelis, declaring: “We have to save the peace process and implement the road map . . . This cycle of hell must be halted.”

The suicide bomber stepped on to a crowded bus on Jaffa Street disguised as an ultra-Orthodox Jew. The explosives strapped to him were said to have contained bolts and nails to maximise the carnage. Thirteen of the victims died immediately. Three more died in or on their way to hospital. Scores of Israelis gathered around the wreckage chanting “Death to Arabs”.

The Israeli missile attack killed Tito Massaoud, a senior Hamas commander, and another Hamas militant as well as five passers-by. Hundreds of Palestinians surrounded the flaming car, demanding revenge. Later Israeli helicopters returned to Gaza City and fired missles at another car, killing two Hamas militants.

Hamas said that the suicide bombing was retaliation for Israel’s attempted assassination of its most prominent leader, Abdel Aziz Rantisi, on Tuesday.

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