MR. HADLEY:  Good afternoon.  On Tuesday, May 13th, the President and Mrs. Bush will travel to the Middle East. They will visit Israel, Saudi Arabia and Egypt.  The trip will be an opportunity to celebrate the 60th anniversary of Israel’s founding and to demonstrate our nation’s support for and commitment to the region.
 
    The President will reaffirm his personal commitment to peace between Israelis and Palestinians, and encourage continuing efforts for a two-state solution, a democratic Israel and a democratic Palestine living side by side in peace and security.
 
    The trip will demonstrate the President’s steadfast opposition to extremists and their state sponsors, Iran and Syria, who are expending enormous energy to thwart opportunities for security, freedom and peace in the region.
 
    On Wednesday, May 14th, the President and Mrs. Bush arrive in Tel Aviv, and then will travel to Jerusalem. President Bush will meet with President Peres of Israel, followed by a separate meeting with Prime Minister Olmert.  The President will also deliver brief remarks at President Peres’s international conference to celebrate Israel’s 60th anniversary.
 
    On Thursday, May 15th, the President and Mrs. Bush will travel to and tour the ancient fortress of Masada.  The President will then deliver remarks to members of the Knesset, the Israeli parliament, to commemorate the 60th anniversary of Israel’s founding.  The President will also meet with Quartet Representative Tony Blair to discuss progress on international assistance to Palestinian institution-building efforts.  The President and Mrs. Bush will host a reception in honor of Israel’s 60th anniversary.
 
    On Friday, May 16th, the President and Mrs. Bush will participate in a roundtable with Israeli youth before traveling to Saudi Arabia.  The President’s visit to Saudi Arabia will mark the 75th anniversary of the formal establishment of U.S.-Saudi relations.  Upon arrival in Riyadh, the President and Mrs. Bush will be greeted by King Abdallah.  The President will participate in a series of meetings with King Abdallah at the King’s private farm.
 
    On Saturday, May 17th, the President and Mrs. Bush will travel to Sharm el Sheikh, Egypt. The President will participate in a working lunch with Egyptian President Hosni Mubarak, followed by a separate meeting with Afghan President Hamid Karzai.  The President will reaffirm U.S. commitment to a stable and democratic Afghanistan, and discuss the upcoming Paris support conference.  President Bush will also participate in a separate meeting with Palestinian Authority President Mahmoud Abbas.
 
    On Sunday, May 18, President Bush will meet with King Abdullah II of Georgia — Jordan — excuse me — followed by separate bilateral meetings with Palestinian Authority Prime Minister Salam Fayyad and Lebanese Prime Minister Fouad Siniora.  These meetings will be an opportunity to reaffirm the President’s commitment to the freedom agenda in the Middle  East and the search for peace.  The President will also meet with Iraqi Vice President Adil Abd al-Mahdi and Deputy Prime Minister Barham Salih.
 
    The leaders are expected to discuss the Iraqi government’s new economic initiatives, including a $5 billion investment for major infrastructure projects.  They will also discuss preparations for the international compact meeting later this month in Stockholm, and the Iraqi government’s ongoing campaign against terrorists and illegal militias in Basra, Baghdad and Mosul.
 
    The President and Mrs. Bush will then travel to The National Congress Center, where the World Economic Forum in the Middle East is being held.  The President will deliver remarks at the World Economic Forum before departing Egypt for Andrews Air Force Base.
 
    I’ll be glad to take any questions.
 
    Q    Steve, would you characterize this trip as more — sort of more weighted toward symbolic observances that may shore up the President’s efforts to get an agreement before he leaves office?  Or do you think there really is going to be a lot of substantive work and pushing and prodding and semi-negotiating in the midst of all this, as well?
 
    MR. HADLEY:  I think it’s going to be a mix.  Obviously coming to celebrate Israel’s 60th anniversary is both symbolism and substance — symbolism because it is obviously a landmark event in the history of Israel, but also substance because it shows the President’s and the United States’ continuing commitment to the security of Israel.  
 
    He’s obviously not just going to Israel and returning home.  He will have an opportunity to visit Saudi Arabia, which will be a crucial actor both in supporting President Abbas in terms of whatever decisions he makes in the context of the negotiations, and also being part of a process which we hope will occur, which is that any Israeli-Palestinian reconciliation will be in the context of a broader reconciliation between Israel and the Arab world. And obviously Saudi Arabia is critical to that.
 
    And finally, of course, in Sharm el Sheikh he’ll have an opportunity to meet — he will have met with the Israeli parties to the negotiations in Jerusalem; he will have an opportunity in Sharm el Sheikh to meet with President Abbas and Prime Minister Fayyad.  And he will also, at that time in his conversations with other Arab leaders in the region, be working the context for the bilateral conversations between Israelis and Palestinians.  As I said, the support of the Arab countries in the region will be crucial for both Palestinians and Israelis as they make the hard decisions that will be required for peace.
 
    Q    Is there any plan for a three-way, U.S.-Israeli- Palestinian meeting in Egypt?
 
    MR. HADLEY:  There’s really not in terms of a meeting at the level of heads of state and government.  And I can tell you why.  The President — the bilateral conversations between Palestinians and Israeli negotiators seem to be going pretty well.  As you know, on Monday, Prime Minister Olmert met with President Abbas.  Secretary Rice was just there at the end of last week and over the weekend.  During that time there were three-way conversations that she had with Foreign Minister Livni, for example, and also Abu Ala, who are the principal negotiators. 
 
    So at this point, we think the bilateral negotiations are key.  We can be encouraging those negotiations to go forward.  A lot of it is better done, quite frankly, in private than in public.  And this did not seem the time for a big high-level, three-way event with the President and the Prime Minister and President Abbas.  It just doesn’t feel right as the best way to advance the negotiations.  And so, at this point, there is no plans for such a meeting.
 
    Bill.
 
    Q    There really doesn’t seem to be any progress, though, on negotiating with Hamas.  So how do you believe that you can make forward progress if you can’t somehow include them?
 
    MR. HADLEY:  Well, I think — the President’s theory, as you know, is that if the Palestinian Authority and the Israelis can come to agreement for a framework for a two-state solution and for the outlines of a Palestinian state, that will open the door for peace between Israelis and Palestinians.  And at that point, President Abbas will be able to go to the people in Gaza and say, you have a choice:  You can have the kind of life that you have under the oppression, really, of Hamas — and as we all know how difficult the situation is for a Palestinian in Gaza — or you can be part of a Palestinian state, which is what we want and what Palestinians want.  And at that point, the people of Gaza will have a choice to make.
 
    And in some sense, Hamas will have a choice to make.  The door has been open to Hamas to become part of this process for peace.  And the international community has made clear what they need to do.  And it’s a pretty simple formula:  One, turn their back on terror.  It is — the international community and everyone has said, rightly, you can’t get a Palestinian state through the route of terror, because that only institutionalizes and justifies more terror.  Secondly, Hamas has been told you need to recognize the right of Israel to exist.  This is a peace process of a negotiation between representatives of Palestinians with Israelis.  How can you participate in that process if you don’t even acknowledge the right of the person across the table to exist?  And finally, the international community said to Hamas, you need to accept the international agreements that have been a foundation for peace that have been reached to date between Israelis and Palestinians. 
 
    So the door has always been open to Hamas, but they have not walked through it.  And of course, as you know, President Abbas has added one other thing, which is Hamas needs to walk back from the coup d’etat where they seized power in Gaza. So I would say to you, the door has been open to Hamas.  They have to get — become part of this process.  They have refused to do so.  The Palestinian Authority has decided to go forward and negotiate with Israel. They were doing so.  When they reach an agreement — and it is our hope that they will do so by the end of this year — it is their hope, and, of course, we share it — that will be a moment of choice for Israelis and for Palestinians about what is the way forward for peace in the Middle  East.  And we think if a good and fair agreement — fair to Israelis and Palestinians — for a Palestinian state can be reached, we think that both Israelis and Palestinians will rally behind the prospect for peace that offers.
 
    Q    May I follow that?
 
    MR. HADLEY:  Yes, ma’am.
 
    Q    Why no trip to the West Bank?  And also will there be any message about settlements?
 
    MR. HADLEY:  We have talked about settlements all the time.  Our message is very clear.  The Secretary of State has said it every time she’s gone out.  We will talk, I’m sure, about settlements.  We will talk about movement and access, and easing closures and roadblocks and those sorts of things — so those will certainly be on the agenda.  The President, as you know —
 
    Q    If you wouldn’t mind repeating —
 
    MR. HADLEY:  Pardon me?
 
    Q    If you wouldn’t mind just repeating the message about settlements that you’re —
 
    MR. HADLEY:  We basically said our position on settlements is, as you know, the road map position, which is that there must be an end to settlement expansion, full stop.
 
    In terms of why not going to the West Bank — obviously, the President wants to meet with the leadership of Israel and also of the Palestinian Authority.  As you know, President Abbas was just here last week.  The President had an opportunity for an in-depth conversation with him.  And as I mentioned, in Sharm el Sheikh he will have an opportunity to meet with Prime Minister Fayyad and President Abbas and their respective teams.
 
    So he will be able to meet them in those locations and we think that’s really the focus of the trip, is to meet with those leaders and support them and encourage them in the negotiating process.  And he’ll have an opportunity to do that.
 
    Q    Why do that in Sharm as opposed to in Ramallah?
 
    MR. HADLEY:  That’s where people are all going to be.
 
    Q    And they’re just going to be there anyway for the conference?
 
    MR. HADLEY:  Absolutely.
 
    Q    But doesn’t it send sort of a message or signal if you go into the West Bank, given that you’re spending so much time in Israel and not going into the West Bank while you’re there?
 
    MR. HADLEY:  No, you know, I really have to say I don’t think so.  I mean, U.S. officials have — the Secretary of State has been there, the President has been there, we have, as you know, our three generals who are out there working this issue.  We are, in some sense, all over this process both in Israel and in terms of the West  Bank.  And I think it just made sense in terms of the President’s scheduling, and given the messages and the themes we wanted to strike, this seemed to be a good way to accomplish what we are trying to accomplish with the trip.
 
    Q    Just jumping a little further along the timeline of this trip, since the President was not successful in convincing the Saudis to push OPEC to increase output on his last visit to the region, and since then, what if anything will the President be seeking in his talks with the Saudis, related to oil?
 
    MR. HADLEY:  Well, the President not only talks to the Saudis, he, as you’d expect, talks to — most world leaders he talks to these days, the subject of oil comes up.  We are in a time of high demand, high prices and limited supply.  And the message the President has sent to oil suppliers in the Middle East, and I’m sure will continue to send, is that oil supply — that suppliers of oil, as they consider their pricing policies and as they consider their production targets, need to take into account the economic health of the global community; need to take into account the economic health of their customers who pay these prices.  And that’s the message that the President has sent.
 
    I think the message the President is also going to send is  — partly for countries in the region, but also a message back home — that capacity is limited in the international market.  It just is.  Capacity is limited in the Middle East.  There are limits to how much that production can be ramped up without enormous investments of dollars and enormous investments of time.
 
    And one of the things the President has been saying — and you can continue to hear him saying — is, because of this, we need to be both diversifying into other sources of energy other than oil, but we need to be doing what we can here at home to expand our own capacity to produce.  And that, of course, means ANWR, it means Continental Shelf drilling, and it also means refineries.  And the President has been talking all about that.
 
    So there are things we can do, in terms of reminding the suppliers of oil internationally, that they have a stake in the economic health of their customers; but even more importantly, there are things we should be doing at home to expand our capacity to produce oil here at home, which reduces our dependence on foreign sources of oil, which is good for reasons of economics and national security. 
 
    Q    Just to be clear, in his talks, in the President’s talks with the Saudi King and with the Saudi leaders, he will be reinforcing that request for them to do what they can to increase their own production and to get OPEC to increase their production?
 
    MR. HADLEY:  I’m confident he will; he has in the past.  I am confident he’ll use that opportunity during this trip, and will probably do so again in the future, as long as the current situation of high demand, high prices and tight supply continues.
 
    Q    And if he continues to be rebuffed by them?
 
    Q    Steve, on that same topic, oil prices are up 31 percent since his appeal on June — on January 14th.  Is he going to use that sort of argument to reinforce or strengthen his arguments with the Saudis?  Or how is he — what’s going to — what will have changed since January that would strengthen that argument?  What can he do now that he can’t — didn’t then?
 
    MR. HADLEY:  Well, there are developments in terms of the world — the U.S. economy, in terms of its prospects and its strength.  There are developments in the international economy.  There are developments in the prices of oil — I mean, all of the things we talked about.  Look, the President knows a lot about the oil business and the oil markets, as do the people he will be talking to, and I think you can expect that it will be a very informed conversation.
 
    Q    On the Middle East, what is the White House attitude to the idea of the Moscow-Middle East follow-up conference?  Positive, negative, neutral?  And more importantly, on relations, the U.S. relations with Russia now in view of the inauguration, again do you expect change?  Do you want change?  If yes, what kind of change?  If no, why do we keep running into problems?
 
    MR. HADLEY:  Well, the Middle East conference that Russia has talked about is an idea that I think the whole international community is open to, but form ought to follow function here, and let’s see where we are and make sure that it will — it makes sense and will advance the process of negotiations between the parties.  And we’ll have to sort of see how it goes. 
 
    Obviously there is a new President of Russia that has been sworn in.  The President had an opportunity to meet now President Medvedev during his recent visit to Sochi. They had a good conversation.  We expect continuity in Russian foreign policy.  That means there will be areas where we agree and there are areas — going to be areas where we disagree.  And obviously we’re very concerned what Russia is doing in Georgia in a series of actions which we have labeled and said are provocative. And we think Russia needs to back down from those items.
 
    So there will be issues.  We expect that — the President expects to have a good relationship with President Medvedev, and will talk about areas where we have common interest and will talk very plainly about areas in which we disagree.
 
    Michael.
 
    Q    Can I go back to U.S.-Israel for a second?  It’s often been said, I think even from the White House, that the President — that Israel had no greater friend than President Bush in the White House.  I wonder if you’d just reflect over the last seven or eight years whether you think that friendship has been good for Israel? There’s a school of thought now that you hear that that embrace has been counterproductive, has left Israel weaker, more endangered by people around — by countries around them. What would be your general view of that?
 
    MR. HADLEY:  Well, I won’t purport to speak on behalf of Israel — Israelis and how they assess it.  I think as you try and make that assessment, you can think about a couple things:  One, that this President has been very strong on Israel’s right to defend itself, and has defended that right for Israel to defend itself and its people against terror, when initially he was a fairly lonely voice.  And I think that’s been important to Israel and important to give Israel the confidence to defend its people.
 
    Secondly I have — I think you have to conclude that an Iraq without a Saddam Hussein is a much better proposition for Israel than Iraq under Saddam Hussein; that from a strategic context, Israel’s security improved dramatically when Saddam Hussein was removed from power, a regime that had supported terrorists and has supported terrorists that were active against Israel. So I think that has improved the strategic situation of Israel.
 
    Third, I think Israel finds itself now in a process of negotiation with the Palestinians of a — to negotiate a Palestinian state in the context of what will hopefully be an end of conflict and a peace for Israel. Those negotiations are now underway and ongoing. 
 
    And fourthly, the Arab countries in the region, and the international community more generally, but particularly the Arab countries in the region are — now engage that process and supportive of it, and are holding out the prospect that an Israeli-Palestinian peace, as I said before, will be in part of a broader reconciliation between Israel and the Arab states.
 
    Now, those are at this point opportunities, not realities.  But I think if you sum up the total of those things, I think you could make an argument that the last seven years have been very helpful in improving the strategic position of Israel. The violence, the intifada is now dramatically down, violence against Israeli civilians dramatically down.  A major strategic threat to Israel has been removed, and there is a real opportunity, both with Palestinians and with Arab states more generally, for a peace.  That’s not a bad — that’s not a bad seven years’ work.
 
    Q    Steve, I want to ask a similar question about the state of the U.S. relationship with Saudi Arabia. You said that this visit will commemorate the 75th anniversary of those relations. Yet some experts say that the bond is weakening and that this was reflected in the President’s last trip when he, as Matt said, was not successful in persuading the Saudis to help to lower the price of oil.  So what is your view of our relationship with Saudi Arabia?  Is it correct that the bond is weakening?
 
    MR. HADLEY:  I don’t see it that way.  One — and I’ll give you a couple explanations.  One is, I have seen the personal relationship between King Abdallah and the President — and those personal relationships matter, I think particularly with respect to Saudi Arabia.  And that is an important element of the relationship between the two countries.
 
    Second, there are — we have been — we don’t talk a lot about it publicly, but we have been working very closely with the Saudis in terms of counterterrorism cooperation with threats inside Saudi  Arabia.  They — as you may think back a number of years, there was a very serious al Qaeda threat inside of Saudi Arabia; a lot of attacks had occurred against innocent civilians.  That is largely reduced.  And Saudi Arabia has been very active against an al Qaeda threat inside Saudi Arabia. 
 
    We have been very active in supporting that in a number of different ways — much closer, I think, cooperation than we’ve ever had in the past.  That’s obviously something that was very important to the Saudis, and I think if you talk to them, they will acknowledge the role that we have played.
 
    Third, I think it’s no accident that, first, as Crown Prince and now as King, King Abdallah has refreshed his plan for Middle East peace, which is the basis for, as I said earlier, the prospect that a Palestinian-Israeli reconciliation can be in the context of a broader Israeli-Arab reconciliation.  I think he did that for his own reasons.  He thought it was best for his country, but he certainly did it with our encouragement.
 
    So I would say to you that it is a strong relationship — doesn’t mean that we persuade them on every issue to do what we want them to do when we want them to do it.  That is not what this relationship is about.  This is a relationship of partnership, where we have a lot of common interests, and we are working together to advance them. 
 
    So I think the relationship is in pretty good shape.  That’s not to say that there weren’t stresses — obviously the Iraq war was a stress, and managing the situation, subsequent.  There are still issues, I’m sure, the Saudis raise with us.  We have issues that we raise with them.  We would like to see them offering greater diplomatic support for Iraq, embracing Iraq as a part of the Arab family.  They have not gone as far as we would like on that score. 
   
    And secondly, we think there is a time of strategic opportunity in the Middle East.  There is a struggle going on between those people who support the ideology of terror and attacks on innocent civilians to achieve political objectives, and those people that resist — those people who want peace, who want stability, who want to bring a better life to their people.  That is a enormous struggle, and you see it going on in Iraq. You see it going on in Lebanon. You see it going on in the Palestinian  Territories. 
 
    We would like Saudi Arabia and other Arab states to invest their diplomatic capital and their financial capital to help those aspiring democracies who are struggling against extremists.  We think there is a strategic opportunity.  And one of the things the President will be doing is encouraging all the Arab states in the region to see this opportunity and make commitments to it in terms of their diplomacy and in terms of the financial resources.
 
    Q    Myanmar. Can you bring us up to date on the effort to get U.S. — visas for the U.S. experts and to get other U.S. aid in there?  Tell us why you think that the generals have been so reluctant to grant them to this point.
 
    MR. HADLEY:  It’s hard to fathom.  It is a — and I haven’t seen all the pictures; I think you have — but the latest estimates are that 100,000 people have probably lost their lives and there are large numbers that are still not accounted for.  This is a humanitarian disaster of enormous proportions.
 
    The international community is ready, willing and able to help.  It is not just the United States; there are at least a couple dozen countries and NGOs that are ready to go in and help.  And at this point the junta has not allowed them access, the visas have not been granted, and the green light has not been given for people to go in.  And it is — it’s simply going to compound the humanitarian disaster.
 
    And we again join our voices with really the whole international community and say, this is not about politics, this is about helping people in need. And the junta should please open its doors and let the international community provide humanitarian assistance to the people in Burma because they need it desperately.
 
    Q    Do you think their refusal is about politics?
 
    MR. HADLEY:  I don’t know, because it’s not just us.  It’s not just that the United States stay out, it’s everybody stay out.  And it’s hard to understand, given the extent of the commitment — of the calamity that has befallen the people of Burma.
 
    And I don’t want to say a whole lot more because I don’t want to politicize this.  It is something where it’s a humanitarian disaster and the international community should be permitted to help.
 
    Thanks very much.
 
    Q    Prime Minister Olmert looks like he might lose power. Would that complicate the peace talks?
 
    MR. HADLEY:  Obviously I can’t comment on the internal investigations that are going on within the Israeli system.  He has obviously been a very important part of these peace negotiations.  But again, remember, these are negotiations going on between the government of Israel and the Palestinian administration, in the context of the PLO, and they are negotiating teams that involve representatives from other members of the Israeli government on one side and other representatives in the PLO on the other end.
 
    So again, we’ll have to see in terms of the Prime Minister’s situation. And beyond that I can’t comment.
 
    Thanks a lot.