Israeli Prime Minister Ehud Olmert said Saturday he planned to meet moderate Palestinian President Mahmoud Abbas and work with him to push peace efforts despite the detention of an Israeli soldier by Gaza militants with links to the ruling Hamas party.

At a joint news conference with Olmert, visiting British Prime Minister Tony Blair expressed his support for a renewal of Israeli dialogue with Abbas despite Hamas' control of the Palestinian parliament and government.

"It's very important that we see what we can do to re-energize this process," said Blair. "We are in a very preliminary stage of debating and talking about these things, but I hope very much that in the time to come that we can make progress."

Long-stalled Israeli-Palestinian peace talks hit a new obstacle in January when the Islamic Hamas group swept a Palestinian parliamentary election.

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Israel, backed by the United States, Britain and other Western countries, has refused to recognize the Hamas-led government and debilitating international sanctions have plunged many Palestinians deeper into poverty.

Although Olmert has expressed his willingness before to meet Abbas, he has not done so since taking office four months ago.

"I ... told Prime Minister Blair that I intend to meet with Chairman Abbas in order to make real progress on the outstanding issues on our mutual agenda," Olmert said. "The issue that is our first priority with the Palestinians naturally is the release of Cpl. Gilad Shalit."

Shalit was captured in June by Hamas-linked militants in Gaza who carried out a cross-border raid on a military outpost in southern Israel. His freedom is "a condition for any progress," Olmert said.

He did not say when he would meet Abbas.

The Olmert-Blair meeting was overshadowed by internal political crises facing both leaders.

Blair gave in this week to a fierce rebellion in his Labour Party, reluctantly announcing on Thursday that he would resign within a year. He brushed aside suggestions that his Mideast visit was an effort to distract attention from those woes.

"People can be as cynical as they like, but I've been passionate about this issue (Mideast peace) ... for many years and I'm not going to stop trying on it," he said.

He declined to answer questions about the bitter infighting wracking his party and reprimanded reporters for raising it.

Olmert has been fiercely criticized for his handling of the war in Lebanon and beleaguered by demands for an official state inquiry, which he has ruled out.

The two gave each other public support, and Olmert was particularly effusive in his praise of Blair.

They had also discussed Iran's nuclear efforts and a fragile U.N.-brokered cease-fire that brought an end to a monthlong war between Israel and Lebanon's Hezbollah guerrillas.

The British leader refused to say whether he would back sanctions on Iran if it does not comply with U.N. demands to halt uranium enrichment. Many in the international community believe the enrichment is part of a nuclear weapons program, but Iran says it is for peaceful power-generating purposes.

Blair's handling of last month's fighting between Israel and Hezbollah militants in Lebanon is a major cause of his political troubles. Many in his party were infuriated by his refusal to break ranks with U.S. President George W. Bush and call for a swift end to the fighting, interpreting that stance as a tacit backing of Israel's offensive.

Blair defended his position, saying it had taken time to negotiate a peace deal that would hold.

"We worked very hard to get the only cease-fire that was ever going to be sustainable, and that was one based on the political framework set out in (U.N.) Resolution 1701," he said.

He has also alienated many in the Palestinian territories, where a group of prominent intellectuals published a statement Thursday saying he would not be welcome in the West Bank.

He plans to meet Abbas there Sunday.

He will not see Palestinian Prime Minister Ismail Haniyeh of Hamas or other members of his government, which Britain and other Western countries do not recognize.

Haniyeh blasted Blair in a column published Saturday in the London-based Guardian newspaper, accusing him of having "one-sided" policies that hurt the Palestinians.

"At the heart of our region's problems is the Israeli occupation, which has brought about endless suffering and disasters. If you wish to do the right thing, Mr. Blair, then work for the end of occupation without further delay," Haniyeh wrote.

Blair plans to see Shalit's family in Jerusalem, along with relatives of two Israeli soldiers captured by Hezbollah in a cross-border raid that sparked the Lebanon fighting.