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United States Secretary of State Condoleezza Rice said Sunday that the U.S. will determine its policy towards the new Palestinian unity government on the basis of whether or not it meets the Quartet's demands that it recognize Israel, renounce violence, and accept prior accords.

"We know that when that government is formed we will be making our decision on the basis of whether or not it meets the Quartet principles," Rice said.

Rice told reporters that the U.S. was committed to working with Palestinian Authority Chairman Mahmoud Abbas.

"I think that we can continue to work with Abu Mazen [Abbas], continue to discuss with Abu Mazen, continue to explore with Abu Mazen," Rice said.

Rice met privately with Prime Minister Ehud Olmert for two and a half hours Sunday, and the two sides did not issue any statements following the meeting.

Abbas' aides said that Rice told the PA chairman during their Ramallah meeting Sunday that she'd withhold judgment on the new PA unity government until it has been formed, but suggested the U.S. would not budge from its demands.

"The Americans told us that this agreement does not meet the Quartet conditions," Abbas aide Yasser Abed Rabbo said. "But we have an understanding with Rice that they will wait until we see this government declare its program."

Abbas, in turn, told Rice that his deal with Hamas was the best he could get, suggesting it's unlikely there will be a change in the government's program.

During the meeting, Rice said the U.S. position is unchanged, a senior American official said, speaking on condition of anonymity because the talks were private.

He confirmed the U.S. would withhold judgment until the Palestinian government is formed. "We will reach our own conclusions," he said.

Rice sought explanations Sunday from Abbas about the new PA unity government that both Washington and Israel say they intend to shun, and Abbas on Sunday tried to persuade Rice to give the Hamas-Fatah coalition a chance, his aides said.

In his talks with Rice, Abbas portrayed the power-sharing deal as an achievement, saying it has helped moderate Hamas. Abbas also emphasized that he, not the government, would handle any negotiations with Israel, and Rice assured him the U.S. would continue dealing with him, his aides said.

Palestinian Prime Minister Ismail Haniyeh of Hamas accused the U.S. and Israel on Sunday of trying to sabotage the unity deal.

Pledging to continue to "probe the diplomatic horizon," Rice traveled to the West Bank to meet the Palestinian leader hours after Olmert said that Israel and the U.S. were agreed that the new government must meet international demands.

The meeting ended after two hours, and Rice departed without commenting to reporters.

Abbas, Olmert and Rice are due to hold a trilateral summit in Jerusalem on Monday. Following her meeting with Abbas, Rice was to return to Jerusalem for talks with the prime minister.

"I hope that this meeting with the three of us will be an opportunity to understand the current situation and commit and recommit to existing peace agreements," Rice told reporters at the start of the meeting Sunday, with Abbas seated at her side.

Rice acknowledged later that the moment is awkward for discussions of peace, but said she wanted to go ahead with Monday's summit with Abbas and Olmert.

"We could have decided not to meet during this time, but I actually think that when people have questions and want to explore issues that arise out of something like the agreement to form a national unity government that it's better that they be able to do it face to face," Rice told reporters.

Olmert told the cabinet earlier Sunday that the U.S. and Israel are in total accord on shunning any Palestinian government that doesn't meet international demands to recognize Israel, renounce violence and accept existing peace accords.

The prime minister said that he and U.S. President George W. Bush had spoken by phone Friday about the Palestinian power-sharing accord whose platform falls short of meeting those demands, posed by the Quartet of Middle East negotiators - the U.S., European Union, United Nations and Russia.

The ruling Hamas movement and its rival Fatah agreed earlier this month at a summit in Mecca on the formation of a new unity government, aimed at stemming months of factional violence and lifting a year-long international aid embargo.

"A Palestinian government that won't accept the Quartet conditions won't receive recognition and cooperation," Olmert told ministers. "The American and Israeli positions are totally identical on this issue."

But Interior Minister Roni Bar-On, who is close to Olmert, said Israel "would not boycott" Abbas because it needed to keep a channel of communications open with the Palestinians and snubbing him would "definitely thrust him towards Hamas."

The three-way summit will begin Monday morning at the David's Citadel Hotel in Jerusalem, where Rice and her entourage are staying, and last a few hours.

The meeting between Olmert, Abbas, and Rice will be followed by a lunch in which the three will be joined by Foreign Minister Tzipi Livni, Defense Minister Amir Peretz, and Vice Premier Shimon Peres.

No joint press conference is planned for afterward, in order to avoid a public comment on the anticipated differences of opinion. However, Rice will issue a statement.

Rice arrived in Jerusalem on Saturday, where she met with Livni. The two had also spoken several times by telephone before Rice's arrival. She also met with Peretz.

Abbas' office said Sunday that the two had canceled the press conference scheduled for after their meeting.

During their phone conversation Saturday, Olmert and Bush discussed the ramifications of the Mecca Agreement, as well as the Iranian nuclear issue.

A source in Jerusalem said that Bush and Olmert "see eye to eye on the need for any future Palestinian government to meet the Quartet's demands."

Bush also spoke with King Abdullah of Saudi Arabia, under whose auspices the Mecca Agreement was drafted.

Olmert plans to tell Rice on Sunday that the Mecca Agreement and its implications should be the main topic of discussion at Monday's summit.

According to the government source, Israel will insist that any diplomatic progress be conditioned on the Palestinian unity government not only accepting the Quartet's conditions, but also acting on them. Olmert and Rice will discuss two scenarios - if the PA does accept the Quartet's demands and if it does not.

"We have to think about how to behave if Salam Fayyad, a moderate and acceptable figure, becomes finance minister in a Hamas-led government," the source said. "Israel will not be willing to recognize such a government, even if it includes some moderates."

Another Israeli source added, "In the worst-case scenario, we will boycott the Palestinian unity government, just as we boycotted the Hamas government until now."