The announcement on Thursday by the head of the Palestinian Authority, Mahmoud Abbas, that he would not be standing for re-election next January has caused dismay among regional leaders, with Israeli President Shimon Peres and the Arab League’s secretary-general, Amr Moussa, reportedly joining a chorus of voices urging Abbas to rescind his decision.

Palestinian officials say the Fatah party leader's announcement was motivated by his disappointment with Washington on the settlements issue. After months of pressuring Israel for a complete freeze, Washington appeared to backpedal last week, with US Secretary of State Hillary Clinton saying Palestinians should enter talks first and resolve the settlement issue later.

Despite wide speculation that the effective resignation is largely a tactic aimed at rallying Washington’s support, reports in the Isreali press have quoted several officials, all requesting anonymity, who say they would like to see the moderate Abbas stay in power.

A senior Israeli official told news agency AFP that hawkish Prime Minister Benjamin Netanyahu sees Abbas "as a partner for peace," while the popular Ynet news website quoted another unnamed official as saying: "It's in Israel's interest to have Abbas stay in office."

The left-leaning Haaretz daily reported that Shimon Peres had telephoned Abbas a day before his announcement to try and talk him out of his decision.

Officially Israel has refrained from commenting on Abbas’ announcement, calling it an internal Palestinian affair.

The Egyptian news agency Mena also reported a telephone call from Arab League chief Amr Moussa, in which he urged Abbas to forgo his choice to step down.

Hamas keeps its distance

Abbas had called for the January election last month after failing to reach a unity deal with rival Islamist group Hamas.

Hamas won parliamentary elections in 2006 and wrested control of the Gaza Strip from forces loyal to Abbas a year later.

Hamas official Sami Abu Zuhri said Abbas's decision whether or not to run was "internal Fatah business".