Bush 'disappointed' in Arafat

President Bush

WASHINGTON (CNN) -- With reports of the latest Mideast violence still fresh, President Bush on Friday that said he was "very disappointed" with Yasser Arafat and that the Palestinian leader must do more to end terrorism.

The president made the comments after his national security team met to discuss potential sanctions against the Palestinian Authority.

"I am disappointed in Yasser Arafat," Bush said. "He must make a full effort to rout out terror in the Middle East. In order for there to be peace we've got to rout out terror."

"Ordering up weapons that were intercepted on a boat headed for that part of that world is not part of fighting terror, that's enhancing terror and I'm obviously very disappointed in him," Bush said, referring to 50-ton shipment of arms intercepted by Israel.

VIDEO CNN's John King reports on the Bush administration's disappointment in Palestinian leader Yasser Arafat over an arms shipment (January 25) Play video (QuickTime, Real or Windows Media)   MORE STORIES Suicide bomber hits Tel Aviv

Among the array of options being considered by the Bush administration is an outright break of ties with Yasser Arafat's organization, senior U.S. officials said, though some added that such a step is unlikely at this time.

The officials said Vice President Dick Cheney and Defense Secretary Donald Rumsfeld and their senior aides have in recent days advised Bush to suspend relations with the Palestinian Authority.

On the other side of the spectrum, Secretary of State Colin Powell has told the president that he believes it is important to maintain some sort of relationship with Arafat.

Powell said Friday that the U.S. has "all kinds of options" in its relationship with Arafat, but he added that Arafat needs to take "irreversible action to get terror under control."

"He knows what is expected of the Palestinian Authority and of him as the leader of that authority if we're ever going to go forward and get toward a cease fire," Powell said.

The discussions come amid administration concern over what it considers a lackluster response to recent demands that Arafat do more to crack down on terrorism.

The administration also is dissatisfied with the authority's response to its alleged involvement in a major weapons shipment from Iran into the Middle East region.

After the meeting, which ran at least 30 minutes longer than it was scheduled, sources said the administration will wait a few days before making a decision, hoping that the fact that such a meeting was held will push Arafat into action.

Also Friday, Assistant Secretary of State William Burns was scheduled to meet with several Arab ambassadors to press them on the need to get Arafat to take stronger steps to combat terrorism and reduce violence in the region. Burns will also encourage the Arab ambassadors to pressure Arafat to explain the weapons shipment.

Israel Radio reported the Bush administration has provided a number of Arab nations with proof that the Palestinian Authority was involved in attempting to smuggle the weapons into the Palestinian territories aboard the Karine-A.

Several senior officials said the administration's next move will hinge on what steps Arafat takes to improve the security situation.

Tel Aviv attack

Violence in the Mideast continued Friday, when a suicide bomber exploded a device in Tel Aviv, wounding at least 22 people, two of them seriously.

The bomb went off in a crowded shopping area near the old bus station, city police said. There was no immediate claim of responsibility. Eyewitnesses saw the suicide bomber leaning against a motor scooter shortly before the explosion.

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The Palestinian Authority condemned the Tel Aviv attack, but also condemned what it called Israeli assassinations.

Hours before the suicide bombing, Israeli troops arrested two Hamas activists in the West Bank suspected of carrying out terror attacks against Israeli troops and civilians and shot dead two other Hamas members during a skirmish in Gaza. The bombing also came one day after Israel killed Hamas activist Bakr Hamdan in a missile attack.

Hamas vowed to avenge the killing of Hamdan. The fundamentalist Islamic group, which has a military wing that has carried out attacks against Israelis, has been labeled a terrorist organization by the U.S. State Department.

-- CNN Senior White House Correspondent John King, State Department Correspondent Andrea Koppel and Producer Elise Labott contributed to this report.