JERUSALEM -- An Islamic militant blew himself up in a packed bus during morning rush hour Wednesday, killing seven other passengers, including four Israeli soldiers. Israel said it wouldn't retaliate for now and agreed to a crucial meeting with the Palestinians in an effort to produce a cease-fire after 18 months of Mideast fighting.

Israel Radio reported that the meeting of security commanders from both sides with U.S. envoy Anthony Zinni, in Tel Aviv late Wednesday, ended without agreement on a truce, and another session would be held in the coming days.

Zinni earlier contacted Israeli Prime Minister Ariel Sharon and Palestinian leader Yasser Arafat to ensure that the delicate truce talks would not be derailed by the bombing near the northern town of Afula. The explosion, which blew gaping holes in the sides of the bus, also injured 27 people, many of them Arab Israelis.

Israelis and Palestinians have both hinted a truce could be declared as early as today. However, the militant Islamic Jihad group claimed responsibility for Wednesday's bombing and said it would not abide by any cease-fire agreement.

"I had the honor to organize this attack, and I want to tell the Israelis that as long as Sharon is killing Palestinians, we in Islamic Jihad will kill Israelis," said Mahmoud Tawalbi, head of group in the West Bank town of Jenin.

The U.S. truce plan, written last year under the guidance of CIA director George Tenet, calls on Palestinians to "apprehend, question and incarcerate terrorists." Israel is prohibited from "attacks of any kind against Palestinian Authority facilities."

No specific mechanism is foreseen to prevent retaliation for an attack, and both sides will have to exercise restraint, said a diplomat.

However, Israeli Defense Ministry spokesman Yarden Vatikay said there will be no provisions in the agreement for dealing with attacks. He said there can be no cease-fire if there are terror attacks.

Previous cease-fires

Several previous cease-fires collapsed, and this month has seen the deadliest spurt of violence since the fighting began in September 2000.

"The patience of the Israeli public will not be able to hold out for another attack or two," said Israeli Labor Minister Shlomo Benizri.

Following Wednesday's bombing, Sharon said Arafat bore ultimate responsibility for failing to prevent it. Arafat has "not moved away from a policy of terror, has not taken any steps and has not given any orders to stop attacks," Sharon said.

But Israel Radio, citing sources close to Sharon, said Israel would hold off on retaliation and would not cancel the Wednesday night truce talks in Tel Aviv, during which the Palestinians were to respond to Israel's proposed truce timetable. The Palestinian Authority denounced Wednesday's bombing and said it was working for the cease-fire, which would require it to arrest militants, something it has been reluctant to do.

All groups should "refrain from carrying out any operations against civilians inside Israel," the Palestinian leadership said in a statement.

On Tuesday, Sharon said that if a cease-fire is in place, Arafat will be permitted to attend an Arab summit in Beirut next week, where a Saudi peace plan is to be presented that calls for establishment of normal relations between Israel and the Arab world in exchange for a return of all lands captured in 1967.

Presidents Hosni Mubarak of Egypt and Bashar Assad of Syria discussed the plan in talks in Cairo on Wednesday.

They said in a joint statement they would work to persuade fellow Arab leaders to agree on a "unified stand" on the Saudi initiative at the summit.

While an Israeli-Palestinian cease-fire deal appeared within reach, each side looked to the other to take a first step.

Israeli said the Palestinians would have to immediately crack down on militants, including widespread arrests. The Palestinians said the Israelis would have to lift military roadblocks that have kept most Palestinians confined to their hometowns and villages.

Israeli officials have expressed doubt about the Palestinian Authority's ability to carry out its obligations.