"I think all the members of the Quartet are worried about this latest development," he told reporters in New York, referring to the sponsors of the Road Map – the UN, European Union, Russia and the United States – which calls for parallel and reciprocal steps by both sides leading to two States living in peace by the end of 2005.

"We were all hopeful that there was a new opening, a new opportunity that should be exploited to reenergize the process, and we are all going to do whatever we can with both sides to get the process back on track, and to give the new Palestinian authority as much help as we can with its own reform process, and particularly the restructuring of the security forces," he added.

Only last Thursday, Under-Secretary-General Kieran Prendergast told the Security Council there was "a palpable sense of expectation of real, substantial and sustainable change in the region" after the election of Palestinian President Mahmoud Abbas, who has called for an end to attacks on Israel, and the formation of a new Israeli Government to evacuate settlements in the occupied Gaza Strip.

But hours later Palestinian militants killed six Israelis at the Gaza border in an attack which Mr. Annan called "a real blow to the peace process."