International Middle East peace envoy Tony Blair told the largest Palestinian newspaper this week that Israeli Prime Minister Ehud Olmert and Palestinian Authority leader Mahmoud Abbas have reached a unsigned secret peace agreement.

Blair was quoted by the Jerusalem-based daily Al Quds as saying that "continuous meetings between Abbas and Olmert...have produced an agreement," though he said he would abide by an decision by both leaders to keep the details of the agreement secret for the time being.

The agreement remains unsigned because Israeli law forbids Olmert to make significant policy changes or decisions while he is head of a transition government.

However, anything Olmert and Abbas agreed to will be expected by the international community to form the basis for peace negotiations going forward, regardless of who wins Israel's upcoming general election.