The Bush administration intends to intensify its demand that Palestinian leaders dismantle West Bank and Gaza terror organizations after a devastating bomb attack on a packed bus in Jerusalem (search).

Secretary of State Colin Powell telephoned Israeli Prime Minister Ariel Sharon and Foreign Minister Silvan Shalom as a White House spokesman condemned and deplored the attack Tuesday that virtually shattered an already shaky truce pledged by Palestinian extremist groups.

• Video: Jerusalem Bus Bombing

A senior U.S. official insisted President Bush's policy, grounded in a peacemaking roadmap, was not in crisis, but that additional emphasis would be put on a call for Palestinian leaders to dismantle the terror infrastructure.

"I don't think it puts it in jeopardy," said the official, speaking on condition of anonymity.

Bush and British Prime Minister Tony Blair (search) spoke in a phone conversation Tuesday night and agreed on the need for stepped-up efforts to combat terrorist groups in the region, White House spokesman Scott McClellan said.

Islamic Jihad, which had agreed to a truce at the behest of Palestinian Prime Minister Mahmoud Abbas (search), took responsibility for the bus attack, saying it was avenging the killing of a senior operative by Israeli troops last week.

Hamas, which the State Department also condemns as a terrorist group and also had pledged a truce, later claimed responsibility for the attack as well.

Even before the terrorist struck, Bush had said a permanent peace between Israel and the Palestinians could only be achieved by dismantling terrorist organizations.

"Here's my view on cease-fires," said Bush, standing outside a gas station in Crawford, Texas, en route to play a round of golf. "I'm happy there's calm. I think that's important. But the most important thing is for the parties that care for peace to dismantle terrorist organizations that want to kill."

"That's how we're going to achieve a peaceful settlement in the Middle East. Calm is good. The fact that people aren't dying is good. But the ultimate solution -- and this can happen quickly in my judgment -- is to find those who would believe killing is the best approach to dealing with the very difficult problems in the Middle East," he said.

Only a few hours later, a suicide bomber blew himself up on a bus crammed with Orthodox Jews on their way home from prayer at the Temple Wall, the holiest site in Judaism.

Abbas condemned the bombing as a "terrible act."

The prime minister has resisted U.S. appeals that he dismantle terror groups, arguing it could touch off a civil war among Palestinians. He has employed rhetoric, instead.

Despite U.S. assurances the peace process remained on track, Israel called off a plan to give the Palestinians control of Jericho and Qalqiliya on the West Bank.

Bush did not issue a statement.

White House spokesman Sean McCormack told reporters assigned to the President's monthlong vacation stay in Texas that "we condemn this vicious act of terrorism. We call on the Palestinian Authority to dismantle terrorism."

McCormack said the president offers his "thoughts and prayers" to the wounded and to the families of those killed.