While Israel was moving in the right direction in its offer to restrict but not stop the settlements, Clinton said, its offer "falls far short" of U.S. expectations.

Clinton said her earlier praise of Israel's offer, during a stop in Jerusalem, had been intended as "positive reinforcement." But it drew widespread criticism from Persian Gulf ministers who interpreted it as a softening of the U.S. position on settlements, which stand in the way of a resumption of Israeli-Palestinian peace talks.

In a sign of U.S. eagerness to calm Arab concerns about the U.S. position on settlements, Clinton is extending her trip by one day to fly to Cairo to meet with President Hosni Mubarak on Wednesday, her staff announced. She had been scheduled to return to Washington today.

Clinton's comments Saturday in Jerusalem appeared to reflect a realization within the Obama administration that Prime Minister Benjamin Netanyahu's government will not accept a settlement freeze and that a partial halt might be the best lesser option. Her appeal on Saturday seemed designed to make the Israeli position more palatable to the Palestinians and Arab states.

"We have to work with what we've got," said one U.S. official, adding: "We need to press both sides not to miss this opportunity."

During a photo session yesterday with her Moroccan counterpart, Clinton was asked by a reporter about the Arab reaction, and she responded by reading from a written statement that appeared designed to counter the skepticism about the Obama administration's views on settlements.

"Successive American administrations of both parties have opposed Israel's settlement policy," she said. "That is absolutely a fact, and the Obama administration's position on settlements is clear, unequivocal and it has not changed. As the president has said on many occasions, the United States does not accept the legitimacy of continued Israeli settlements."

Clinton's tweaking of her earlier remarks appeared to satisfy at least some of the Morocco meeting attendees. Palestinian Foreign Minister Riad Malki said yesterday that "we have heard her say something completely different from that statement in line with previous statements, so we are happy that such a position was highlighted and brought back to the right line and right now we will see how things will go."