By Sue Pleming JERUSALEM, Feb 19 (Reuters) - U.S. Secretary of State Condoleezza Rice meets Israeli and Palestinian leaders on Monday, but has sought to lower expectations about the talks' outcome. Rice said the meeting with Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas would amount to "informal discussions" rather than negotiations. Rice spent Sunday shuttling between the Israelis and the Palestinians, trying to agree an agenda for the talks which have been overshadowed by a deal to form a Palestinian government comprising Abbas's Fatah party and the militant movement Hamas. The United States has said it would like both sides to start talking about the tough issues, such as the contours of a new Palestinian state, refugees and the status of Jerusalem. Abbas said they would explore "the horizon for the peace process" at Monday's talks, as well as discuss the new Fatah-Hamas coalition. But Israeli officials have said the main focus of the talks will be the unity government which Israel has said it will boycott if Hamas does not meet Quartet conditions to renounce violence, sign on to past agreements and recognize Israel. QUARTET PRINCIPLES Rice made clear that while the U.S. administration reserved judgment, any government would have to meet principles laid down by the Quartet of Middle East mediators, comprising the United States, European Union, the United Nations and Russia. "We are going to wait until there is a government but it should be absolutely clear to everybody that the Quartet principles are going to govern what decision we make," Rice said. Analysts were pessimistic the meeting would break a deadlock in Israeli-Palestinian negotiations, particularly as Olmert and Abbas are weak domestically. "All these missions and visits that increase expectations will end with disappointment and frustration. I don't think this time will be the exception," Zakaria al-Qaq of al-Quds University said. But he said the United States has few options other than to continue supporting Abbas. "There is nobody else. The United States is stuck," he said. A joint news conference is not planned after the talks but officials from all sides have been working in recent days to come up with a statement that indicates a commitment to past agreements and a wish to move ahead. "Everyone is investing so much in pushing this process forward. If we come away with nothing, I think it would be an opportunity wasted," said one Arab diplomat. Rice, for her part, said she did not want to push either side into making any deals they could not fulfil. "It is extremely important that we have these discussions in a way that builds confidence and builds a sense of candour," she said of the meeting. (Reporting by Sue Pleming; email:sue.pleming@Reuters.com; tel: 202 898 8393))
