The Illinois senator had a busy Wednesday in Jerusalem, where he focused his attention on assuring the Israelis of his unwavering support for Israel's security and maintaining special and strong ties between the two countries.

He praised the "miracle" of Israel in his meeting with President Shimon Peres, and told him: "I'm here on this trip to reaffirm the special relationship between Israel and the United States and my abiding commitment to Israel's security, and my hope that I can serve as an effective partner, whether as a U.S. senator or as a president."

He toured the Holocaust memorial and laid a wreath at the Hall of Remembrance, describing the memorial as a "place of hope."

Obama spoke with top officials, including Prime Minister Ehud Olmert, and flew to the southern Israeli town of Sderot, which has been the main target of home-made Palestinian rocket fire from the Hamas-controlled Gaza Strip.

From Sderot, he said that a "nuclear Iran poses a grave threat" and that the world must prevent it from obtaining a nuclear weapon.

His remarks were seen as an attempt to ease Israeli concerns over his previously stated willingness to negotiate directly with Tehran over its nuclear program.

Unlike his Republican rival Senator John McCain who did not visit the Palestinians during his trip to Israel in May, Obama took some time between his busy schedules in Jerusalem to visit the West Bank town of Ramallah on Wednesday to chat with Palestinian President Mahmoud Abbas and his prime minister, Salam Fayyad, on his role in Middle East peacemaking should he win the election.

Although his aides insist that Obama was not in the region to engage in negotiations or policymaking, Palestinian officials said he told the leadership in Ramallah that if he becomes the next U.S. president, "he will be a full and positive partner in the peace process and will not lose a single moment in pursuing it."

Palestinian negotiator Saeb Erekat told reporters that Obama "supports a peaceful solution to the Israeli-Palestinian conflict and said from the first moment of his presidency he will be a very important partner in the peace process."

During his visit to the Jordanian capital, Amman, on Tuesday, Obama told reporters he would work for a negotiated breakthrough in the Middle East conflict "starting from the minute I'm sworn into office" – in a clear message that he would not wait until a second term like the George W. Bush administration before engaging in Middle East peace making.

He also said that while the close alliance with Israel would not change, "what I think can change is the ability of the United States government and a United States president to be actively engaged with the peace process and to be concerned and recognize the legitimate difficulties that the Palestinian people are experiencing right now."

Obama, however, did not make a statement from Ramallah, and his brief stop there was privately criticized by Palestinian diplomats as insignificant and a mere attempt to show that he could be more impartial in the peace process than his Republican opponent.

The Democrat senator stumbled into a political Middle Eastern minefield last month when he told the powerful pro-Israel lobby, the American Israel Public Affairs Council, that Jerusalem should remain the undivided capital of Israel.

The remarks, which were later watered down by his aides, drew sharp criticism and anger from Palestinian, Arab and Muslim leaders last month.

Obama on Wednesday did not use the word "undivided," saying that "Jerusalem will be the capital of Israel," but that it is also a "final status issue" to be negotiated between the Israelis and Palestinians.

The candidate's remarks in Sderot came just a few hours after Abbas apparently took the opportunity of his brief meeting with Obama to explain to him the "legal and legitimate importance" of East Jerusalem, which Israel occupied in the June 1967 war, to the Palestinians who seek it as the capital of their future state.

A Palestinian official said Abbas also explained to the visiting candidate that according to international law East Jerusalem is occupied territory, and that the Israeli expansion of its settlements there and in the West Bank threatens to torpedo the entire peace negotiations.

"Obama listened," remarked a Palestinian official close to Abbas, whose peace talks with Israel have made virtually no progress since they were re-launched at Annapolis under Bush's sponsorship in November, despite the insistence of the parties that they could reach a peace deal before the current administration's term expires in January.

In any case, the Palestinians generally felt that Obama's visit to Ramallah was just a courtesy call that was squeezed into his Israel visit aimed at appeasing the Jewish vote at home, where U.S. polls showed he is yet to secure the traditionally solid Democratic bloc of American Jewish voters.

Both Palestinian and Israeli commentators seem to be aware that this leg of his international tour, where he is seeking to build early ties with foreign leaders, was primarily aimed at portraying himself as a staunch friend of Israel to impress the powerful Jewish community in the United States, which is said to be closely observing his tour.

The Israeli Haaretz daily headline read: "Obama visiting Israel to impress Jewish voters, not Israelis," while some Arab commentators warned against pinning high hopes on an Obama administration being more objective than the incumbent or previous administrations regarding Palestinian and Arab issues.

Obama, who has already traveled to war-torn Afghanistan and Iraq, as well as Jordan, is still due to visit Germany, France and Britain before wrapping up his tour.