The hawkish premier, who wants a "fresh" approach to the Israeli-Palestinian conflict, will unveil in the White House meeting on Monday his long-awaited policy for regional peace focused on countering Iran, aides said.

Contents are still secret but one Netanyahu aide told AFP that differences between Israel and the United States are "more on the outside."

Disagreements have surfaced on several key issues since Netanyahu's right-leaning government was sworn in at the end of March but the two leaders are likely to use the summit to reaffirm the strong ties between the close allies, aide Zalman Shoval said.

They were planned to give a brief press conference after their meeting which will precede intimate lunch together with their wives.

One major cause of friction has been Netanyahu's refusal thusfar to publicly endorse the creation of a Palestinian state, a bedrock principle of US-backed peace efforts in the region.

Obama himself admitted in March that Netanyahu's election and hawkish coalition did not make peacemaking any "easier" and his administration has fired off several sharp public messages towards Israel.

Netanyahu has assigned top priority to halting Iran's nuclear bid.

Obama, however, has pledged to act vigorously to end the decades-old Middle East conflict and sees its resolution as a key component in a comprehensive regional policy for resolving the crisis with the Islamic republic.

Netanyahu is expected to irk his hosts and the Palestinians by telling Obama that Israel will keep building in existing settlements in the occupied West Bank, a key obstacle in the stuttering peace process.

The tone of the Obama administration has raised fears in Israel that Washington may sacrifice the interests of its staunchest ally in its attempt to end the Iranian estrangement.

Despite the friction, Netanyahu hopes to convince Obama of the viability of his new plan which will effectively replace the latest Israeli-Palestinian peace talks launched in Annapolis, near Washington in 2007.

"If we bring forward a new plan, the Americans will not reject it if they feel it can help their policy," a senior Israeli official said.

Israeli and US officials have played down the chances of an open clash following the key summit.

"There will be no surprises at the meeting. There is a strong, natural alliance between the two states and I see no reason for this to change now," a senior Israeli official told AFP en route to Washington.

The 59-year-old premier this month called for a "fresh" approach to the Middle East peace process based on a three-pronged approach including talks, security cooperation and development of the Palestinian economy.

He advocates bolstering the West Bank economy before negotiating a full peace deal, arguing the Palestinians are not ready for independence and that any Israeli concessions will only strengthen radical groups such as Hamas.

Netanyahu has also said he wishes to renew negotiations with Palestinian president Mahmud Abbas in the coming weeks.

Yet that may not be enough for Obama.

"The Obama administration has said it is after a comprehensive peace in the Middle East. A resolution of the Israeli-Palestinian conflict by a two-state solution is an important component of the peace," a senior US official said.

"But there are other important issues that a comprehensive peace would have to address," he told AFP, alluding to Iran's nuclear program.

Obama's decision to break away from his predecessor George W. Bush's tough approach to Iran by engaging the Islamist republic in talks to defuse the nuclear standoff has raised concern in Israel.

The Jewish state says the negotiations must be limited in time and accompanied by economic and diplomatic sanctions.

Like Obama, Netanyahu is seeking to form a regional coalition with moderate states such as Egypt, Jordan, Saudi Arabia and Turkey to counter Iran's growing regional influence.

He appealed alongside Egyptian President Hosni Mubarak at their meeting on Monday in the Red Sea resort town of Sharm al-Sheikh for tight cooperation against "radical forces".

"In the Arab world there is agreement with our views of the Iranian danger," Netanyahu added after he met Jordan's King Abdullah II in Amman on Thursday.

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