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The Israeli civilian who unwittingly drove the Eilat suicide bomber close to the scene of Monday's attack told police just minutes before the blast that he suspected the man was a terrorist.

A senior Israel Defense Forces officer told Haaretz that the Islamic Jihad suicide bomber who killed three people Monday morning when he blew himself up in a bakery in the southern resort city of Eilat, entered Israel through the border with Egypt, several dozen kilometers northwest of Eilat.

Once in the Simchon neighborhood of Eilat, the terrorist hitched a ride with Yossi Waltinsky, a lieutenant colonel in the IDF reserves, who happened to be driving by.

Waltinsky thought that the man was suspicious, as he was wearing heavy clothing - probably to protect him from the desert chill during the night - and carried a bag. Nevertheless, Waltinsky dropped him off near a gas station, about a kilometer from the area where he carried out the attack.

According to southern district police chief Uri Bar-Lev, who rushed to Eilat immediately after hearing of the attack, Waltinksy then telephoned the police station in the town and said that he suspected the man was a terrorist. Two patrol cars rushed to the scene, but seven minutes after Waltinsky made the call, the bomber carried out the attack.

Israel Radio early Tuesday named two of the fatalities from the bombing as Haim El-Maliach, 32, and Michael Ben-Sa'adon, 27. The third fatality was identified late Monday as 25-year-old Eilat resident Yisrael Samolia, an immigrant from Peru who worked in the bakery, according to the radio.

Authorities said that another person was wounded, but not seriously, in the attack at a shopping center in a residential neighborhood. This was the first ever suicide bombing in the city, although there have been other forms of terror attacks in the Eilat area.

"This was a suicide bombing and the bomber is one of the dead. He apparently entered with a bag or an explosives belt and blew himself up inside the shop," Eilat police told Army Radio.

"Three people and the bomber were killed," confirmed police spokesman Micky Rosenfeld.

Police cordoned off the area, and Eilat police chief Bruno Stein said they believed there could be more bombers in the city.

"Our assumption is that it's not one bomber, and there might be more bombers in Eilat right now," Stein said. The emergency services raised their alert level to the highest.

Based on the examination of the bomber's body, it appears he entered Israel several days ago, and made his way to Eilat on foot, the senior IDF officer said.

Additionally, Public Security Minister Avi Dichter said during a visit to Eilat on Monday afternoon that the bomber left from the northern Gaza Strip and arrived in Eilat through the Sinai peninsula.

Islamic Jihad had said earlier that the bomber, whom it identified as 21-year-old Gaza Strip resident Mohammed al-Saqsaq, had set out from the West Bank, and reached Eilat via Jordan, after seven months of preparation. Jordan has denied that the bomber entered through its territory.

Eilat, some 350 kilometers south of Jerusalem, is bordered by Egypt and Jordan.

Islamic Jihad said the attack was meant to help bring an end to weeks of Hamas-Fatah infighting.

Prime Minister Ehud Olmert said he had spoken to Eilat Mayor Meir Yitzhak Halevi, who he said was "managing things responsibly and with a clear head."

It took police close to an hour to determine that the explosion had been caused by a bomb, and not a gas leak, as initially believed.

Police believe that the explosive device weighed between 4-8 kilograms.

Bread still in trays and shattered glass were scattered outside the shop as ambulance crews and police swarmed the residential street.

The ruling Hamas movement said that the attack was a "natural response" to Israel's policies.

The Palestinian Web site Ramattan quoted Saqsaq's family as saying he had left their home three days ago and not returned.

"We knew that he was going to carry out a martyrdom operation," Saqsaq's brother, Naeem, told reporters at the family home in the northern Gaza Strip. "His mother and father prayed for him to succeed."

Islamic Jihad spokesman Abu Hamzeh said Saqsaq did not enter Jordan legally, but rather was smuggled there a few days ago. Militants waiting for the bomber in Eilat gave him the explosives there, Hamzeh told the Associated Press.

"We held back on operations for a while and gave the stage to Fatah and Hamas to conduct unity government discussions. We saw that it has not achieved anything, so we have reverted to martyrdom operations," Hamzeh said.

Fatah spokesman Ahmad Abdul Rahman condemned the bombing, saying, "We are against any operation that targets civilians, Israelis or Palestinians."

Halevi told Israel Radio that the victims of the attack were likely to be local residents and not tourists.

"It's without a doubt a terrible incident that the town of Eilat is not accustomed to," said Halevi. "The thought that infiltrators could enter Eilat alive and disrupt the running of the town is very worrying."

The attack is also the first suicide bombing since April, when a suicide bomber blew himself up at the old central bus station in Tel Aviv, killing nine people.

Eilat, at the northern tip of the Red Sea, is a popular resort for Israelis and foreign holiday-makers, and has largely been spared the violence of the past six years, since the intifada erupted. Israelis have, however, been the targets of a number of attacks in the neighboring Sinai Peninsula.

Israel Radio reported that Egyptian security forces on Sunday arrested a would-be suicide bomber in north Sinai, who had left a note for his parents saying that he intended to carry out a suicide attack inside Israel.