U.S. special envoy to the Middle East George Mitchell is in the Middle East, and the Palestinians are feeling the pressure.

Palestinian sources on Wednesday said that recent talks with American and international sources have shown that the international community does not want the Palestinians to condition the renewal of peace talks on a settlement construction freeze as has been the case so far.

French sources tell Al-Sharq Al-Awsat that US has refused to provide Palestinian president with guarantees he demanded for renewal of talks, including total freeze of settlements, because they lack Israel's approval.

The sources said that the international community was examining the possibility of granting the Palestinians an economic incentive package to encourage them to return to the negotiations table.

Palestinian sources added, "The Americans are looking to provide our leaders with a ladder to get down from the tree they are in, and want us to return to talks, especially in light of the fact that Israel has declared a settlement freeze, and especially in light of the fact that negotiations over the basic principles of the peace process are already being held between us and the Americans and between the Americans and the Israelis."

The sources estimated that if an economic conference for the Palestinians is announced, and if the Palestinians receive a guarantee from the Americans as to the details of a permanent settlement, they may bend on their stance and return to the negotiations table.

In this context, Fatah bodies and the movement's revolutionary council are slated to stand by their position that talks cannot be renewed without a full freeze in settlement construction. But according to the sources, this position will have no impact if the Palestinians get a letter of guarantees from the Americans – a move which Israel opposes.

Either way, the sources say, the end of January is expected to be a critical period. The sources believe that the renewal of peace talks may be announced during Mitchell's visit to Israel and the Palestinian Authority.

The American envoy arrived in Beirut on Tuesday for a two-day visit in Lebanon and traveled to Syria Wednesday, before arriving in Israel and the Palestinian Authority.

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