President Bush, saying there has been progress toward easing violence in the Middle East, dispatched CIA Director George Tenet to the region Tuesday to talk to Israeli and Palestinian security experts in an effort to promote a lasting cease-fire.

"We believe enough progress has been made on the cease-fire that it is time to send George Tenet to the Middle East to start serious discussions at the security level about how to make sure the cease-fire continues," the president said. "I'm very hopeful that this step will be ... part of building confidence in the region ... between skeptical leaders."

Answering questions during an education meeting with lawmakers, Bush said "we believe strongly we need to stop the cycle of violence before anything can happen" to create peace between Israelis and Palestinians.

At the State Department, spokesman Richard Boucher praised Yasser Arafat for taking positive steps. "The situation appears to be headed in the right direction."

For Tenet, it is a return to the high-profile role assigned him by the Clinton administration. Partly in response to Israeli objections, the Bush administration had decided at the outset to limit CIA involvement in day-to-day diplomacy.

But Boucher said "there is a different situation" now and Tenet will work with William Burns, a seasoned American diplomat who is in overall charge in the area.

Boucher said that while top security officials would see Tenet, there was no certainty that his discussions would be three-way or that he would meet with Israelis and Palestinians separately.

Last week, U.S.-hosted security talks between the two sides were hampered when top Palestinian experts, despite a promise by Arafat, boycotted the talks.

The disclosure of Tenet's assignment followed an appeal by Secretary of State Colin Powell to Arafat to arrest those responsible for the Tel Aviv nightclub bombing over the weekend that killed 20 Israelis.

Boucher said Wednesday he did not know if any arrests had been made.

In a telephone call after a White House strategy session, Powell insisted that the Palestinian leader "undertake a 100 percent effort against violence and terrorism," State Department spokesman Richard Boucher said Monday.

Powell also called Israeli Prime Minister Ariel Sharon, who has held fire despite outcries from Israelis that he retaliate for the bombing and a string of other attacks by Palestinian militants.

To Sharon, Powell expressed his support and encouragement for continued Israeli restraint and assured the Israeli, who is leery of Arafat's intentions, that the Bush administration would not push for reopened negotiations until the environment is right.

At the State Department, experts were dissecting the cease-fire statement that Arafat issued after the Tel Aviv bombing.

"We feel that we've seen statements that are encouraging; we've seen instructions that are encouraging," Boucher said. "We've also seen some reduction in the level of violence."

Nevertheless, 18 Palestinians and four Israeli soldiers were wounded in a gunbattle that raged Monday in Gaza, threatening the lull.

The bomber died in Friday night's suicide attack. But Powell's insistence that Arafat order the arrest of those behind the attack and other atrocities indicates the administration is convinced the Palestinian leader can rein in militants.

Boucher said Powell asked Arafat in his call to "continue the positive steps he has undertaken to follow actions with words."

Boucher also made an overture to the Palestinians by reiterating the Bush administration's endorsement of the Mitchell Commission report.

A key recommendation of the commission, headed by former Senate Majority Leader George Mitchell, is that Israel stop all construction at Jewish settlements. That is a key Palestinian demand as well.