Dan Kurtzer's remark on Friday contradicts earlier reports that there had been a misunderstanding with Washington over the issue.

"US policy is the support that the president has given for the retention by Israel of the major Israeli population centres as an outcome of negotiations," Kurtzer told Israel public radio.

"It is very, very clear to both the United States and Israel what this means."The ambassador was responding to a report in the top-selling Yediot Ahronoth daily, which quoted him as saying Washington had not made any such promise to Israel.

According to the paper, Kurtzer "refuted" the much-repeated Israeli claim that there is an "understanding" with Washington that in a comprehensive future agreement with the Palestinians, Israel would retain sovereignty over large West Bank settlement blocs.

No factual basis

"I tell you that no such understandings were ever reached, and I checked the matter with Washington to receive backing for this," the paper quoted Kurtzer as saying, attributing it to "a misunderstanding" by Sharon's office.

"This story has no basis in fact," Kurtzer said, adding that he intended to explain as much to Israeli Prime Minister Ariel Sharon.

"I will reiterate to the prime minister the absolute adherance of the United States to the understandings that were reached last April between the prime minister and the president of the United States," he said.

Ambassador Kurtzer (R) said he
will explain the matter to Sharon

"That is what is real, not these inaccurate quotes."

The understandings reached last April were outlined in a letter sent by US President George W. Bush to Sharon in which the US leader stressed that the final borders of any lasting settlement must take into account the demographic realities on the ground.

"In light of new realities on the ground, including already existing major Israeli populations centers, it is unrealistic to expect that the outcome of final status negotiations will be a full and complete return to the armistice lines of 1949," the letter said.

"It is realistic to expect that any final-status agreement will only be achieved on the basis of mutually agreed changes that reflect these realities."

Misinterpreted?

"The fact is that there is no misunderstanding between our two governments," Kurtzer said. "Our policy remains absolutely clear and absolutely firm and it is in black and white in a letter that the president gave to the prime minister."

Asked how his comments could have been so radically misinterpreted, Kurtzer said he could not answer for those behind the story.

"There is a very charged political atmosphere and people will have to answer to their own consciences why they would misrepresent, misquote, (and) totally inaccurately reflect the things I said," he answered, attributing it to a "misunderstanding by junior officers".

"There is a very charged political atmosphere and people will have to answer to their own consciences why they would misrepresent, misquote, (and) totally inaccurately reflect
the things I said"

Dan Kurtzer,
US Ambassador to Israel

Shimon Shiffer, who wrote the article, was not immediately available to comment on the ambassador's remarks.

Israel has interpreted Bush's letter as carte blanche to hold on to the large settlements where most of the 240,000 Jewish settlers live, and the route of the West Bank separation barrier, which will include large blocs such as Ariel and Maale Adumim, has been designed to reflect this.

With 28,000 residents, Maale Adumim, which lies just east of Jerusalem, is the most populous settlement in the West Bank. Ariel, which lies deep in the northern West Bank, is one of the next largest settlements, with 16,000 residents.

Under international law, all Israeli settlements in the Occupied Territories are illegal.