Israel raided the West Bank cities of Jenin and Nablus on Thursday after agreeing to launch military strikes against Islamic militants if the Palestinian government does not crack down on them, security sources said.

Palestinian witnesses said they heard gunfire and explosions as tanks entered Jenin and moved into the western part of Nablus, but Israeli military sources said they were regular raids to seek out and arrest militants. No one was hurt.

Security sources said Prime Minister Ariel Sharon and security chiefs, meeting to discuss a suicide bombing that killed 18 people in Jerusalem, had agreed on wide-ranging steps to be taken against militants if the Palestinian government did not immediately crack down on them.

Israel also froze negotiations with the Palestinians after Tuesday's suicide attack, one of the deadliest in three years of violence since the Palestinians rose up seeking independence.

"If the Palestinian government does not take all the steps necessary in the war on terror, actual and meaningful steps, it will not be possible to move to the stage of diplomatic discussion," Sharon's office said in a brief statement.

The statement did not say what steps Israel could take, but they were expected to include military raids to arrest or kill militants. A senior Israeli source said the raids could begin in a matter of hours and last several days but that Israel appeared to have given them "a few more hours" to rein in the militants.

The suicide bombing left a three-month truce hanging in the balance and threatens the success a U.S.-backed peace "road map" which outlines reciprocal steps to end nearly three years of violence and establish a Palestinian state by 2005.

ABBAS ORDERS ARRESTS

In an effort to stave off a tough Israeli response to the suicide attack, Palestinian Prime Minister Mahmoud Abbas cut off contacts with Islamic militant groups on Wednesday and ordered security forces to arrest those behind the bombing.

Abbas and his cabinet later met President Yasser Arafat and his Fatah group in the West Bank city of Ramallah. They vowed to enforce the rule of law and reiterated their commitment to the three-month truce announced by militants on June 29.

"Everyone should adhere to one authority and the rule of law," they said in a statement read out to reporters in Ramallah. "The security forces will be in charge of implementing the resolutions of the Palestinian cabinet."

The statement was unlikely to appease Israel or the United States, which was scrambling to salvage the road map.

The State Department sent a top envoy to meet both sides after Tuesday's bus bombing, and White House spokesman Scott McClellan said it was "important for all the parties to continue talking about the way forward."

The White House put the onus on the Palestinian Authority to rein in the militants and said Israel had the right to defend itself. Abbas says a crackdown would risk civil war.

In the latest violence, Israeli soldiers shot dead 16-year-old Palestinian Islam Ghanem during a raid to arrest militants on the Tulkarm refugee camp in the West Bank on Wednesday, Palestinian witnesses said.

They said he was hit by a bullet when gunfire broke out during the raid. Israeli military sources said the Palestinians had shot first and did not confirm the death.

Peace efforts appear to be in deep trouble. The cease-fire is badly frayed after the suicide bombing and two other suicide attacks last week which followed fatal Israeli military raids.

Israel has shelved its planned handover of occupied West Bank cities, frozen high-level talks and reimposed a clampdown on the West Bank and Gaza Strip.

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