Palestinian premier Rami Hamdallah on Friday withdrew an offer to quit a day after presenting it to president Mahmud Abbas, an official said, just two weeks after the government took the oath.

Hamdallah emerged from a "positive" two-hour meeting with Abbas, a senior government official said, having made clear he wants his powers -- and those of his two deputies -- unequivocally defined to avoid further power squabbles.

But government spokesman Ihab Bseiso said there would be another Abbas-Hamdallah meeting on Saturday.

"What we know so far is that there will be a meeting tomorrow (Saturday) evening between prime minister Hamdallah and president Abbas to continue discussions on this resignation," he told AFP.

The premier presented his resignation on Thursday over what officials and media said was a "power struggle" that had already played out in the fortnight since his government was sworn in on June 6.

"Hamdallah met Abbas... in the president's headquarters in Ramallah and informed him he had decided to withdraw his resignation," the official told AFP, requesting anonymity.

According to sources close to him, Hamdallah had been incensed by Abbas's decision to appoint two deputy premiers in a government formed after his predecessor Salam Fayyad, a Western-backed economist, quit after a spat with the Palestinian president.

"Hamdallah wants clear and defined powers as prime minister and for his deputies, based on the law, so his authority is not encroached on," the official said after Friday's meeting.

On Thursday night a delegation dispatched by Abbas went to Hamdallah's home in Tulkarem, in the northern West Bank, to try to persuade him to go back on his decision, but failed to do so.

Hamdallah had been "upset over his treatment by his two deputy prime ministers, Ziad Abu Amr and Mohammed Mustafa, and their attempts to gain powers not assigned to them," another official said, also requesting anonymity.

"Mustafa was authorised by Abbas to sign all economic agreements, particularly those with the World Bank, without the consent of Hamdallah," he said.

Hamdallah objected, saying these were prime ministerial powers, the official added.

Mustafa, who heads the Palestine Investment Fund and was given the role of economic adviser, was initially tipped as a possible successor to Fayyad.

Mustafa, not Hamdallah, gave the first news conference after the new 25-member cabinet held its first meeting on June 11, raising a few eyebrows.

A third government source told AFP that initial cabinet meetings were plagued with bickering over trivial issues such as who was allowed to sit in which seat, and whether people could smoke or not.

Hamdallah, an independent considered close to Abbas's ruling Fatah faction who was also secretary general of the Central Election Commission, pledged after his nomination to follow a similar path to Fayyad and said he would leave the government line-up largely unchanged.

He made clear he would quickly step aside in the summer after the planned formation of a government of national unity comprising Fatah and its Islamist rival, Hamas.

Fayyad resigned in mid-April after months of difficult relations with Abbas which culminated over the resignation of finance minister Nabil Qassis, which the premier accepted but the president did not.

Fayyad was widely respected internationally for building a sound institutional framework for the Palestinian Authority, and his resignation sparked concern over who would take up his mantle.

But Washington and Europe welcomed the appointment of Hamdallah, who was seen even by Israeli media as a "moderate and pragmatist".

After Hamdallah offered to quit, commentators said the deputy premiers' powers were problematic.

Political analyst Abdel Majid Sweilam said Hamdallah had "not looked forward to being prime minister.

"He accepted the position only on a temporary basis, proved by the fact he didn't resign from his job as head of Al-Najah University in Nablus."

Hamdallah "cannot be an effective prime minister in light of the encroachment on his powers -- two deputies to him were appointed directly by the president," Sweilam said.

Pan-Arab newspaper Al-Quds al-Arabi said "Hamdallah wants to be a prime minister in fact, and to have the final say on prime ministerial issues, but the Palestinian Authority wants him to be just a puppet".

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