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Israel's envoy to Spain said on Thursday the two countries' relations had been damaged after the Spanish prime minister accused Israel of using "abusive force" during an event at which he also wore a Palestinian scarf.

Spain's ability to use its influence to help defuse the growing Middle East conflict could suffer following the speech by Prime Minister Jose Luis Rodriguez Zapatero to a meeting of young Socialists on Wednesday, Ambassador Victor Harel said.

His comments came as European Union foreign policy chief Javier Solana, himself a Spaniard, was involved in talks aimed at ending fighting between Israel, Lebanese Hizbollah guerrillas and Palestinian militants.

"Each declaration which is not balanced has consequences for parties who want to use their influence," Harel told reporters at Madrid's Ritz Hotel where he listened to Spanish Foreign Minister Miguel Angel Moratinos at a conference.

Relations with Spain "are not in their best moment", he said.

Zapatero, who took power in a surprise election victory following Islamist train bombings in Madrid in 2004 and immediately pulled Spanish troops out of Iraq, had told the young Socialists: "No one should defend themselves with abusive force which does not protect innocent human beings."

Spain wants the United Nations Security Council to agree to deploy international troops to stop fighting which has claimed hundreds of lives since Israel launched bombardments nine days ago to stop Hizbollah attacking it with rockets.

Moratinos, who was once the EU's Middle East peace envoy, angrily denied an accusation at the conference by a former Spanish Jewish community leader that Zapatero's remarks were anti-Semitic.

During the question-and-answer session at the breakfast, Mauricio Hatchwell, a member of Spain's small Jewish community, accused Zapatero of being antisemitic.

Moratinos reacted sternly, saying one could be a loyal ally of Israel and still criticize it without being antisemitic. He addressed Hatchwell personally and told him not to repeat such criticism of the government.

"Let this be the last time you publicly denounce and condemn and express yourself saying a Spanish government is antisemitic," Moratinos said.

He said he was not worried by the diplomatic effect of photographs in Spanish newspapers on Thursday of a grinning Zapatero wearing a black-and-white Palestinian scarf passed to him by a student at Wednesday's meeting.

"I imagine that when Prime Minister Zapatero goes to the Wailing Wall, he'll put on a kippah," said Moratinos, referring to a traditional Jewish skull cap and Jerusalem's Western Wall.