Meanwhile, Israeli helicopters fired two missiles at the home of Hamas militant Abdel Salam Abu Musa in the Gaza Strip on Sunday, wounding at least 11 people, witnesses said. Ambulances rushed to the area on a road between Khan Younis and Rafah. There was no word on whether anyone was killed or whether Musa was hurt.
It was the eighth such Israeli missile strike since a Hamas suicide bomber killed 22 people on a Jerusalem bus on Aug. 19. Those attacks have killed 12 militants, including a senior political leader, and five bystanders.
Several leaders of Arafat's ruling Fatah party confirmed the nomination by consensus of parliament speaker Ahmed Qureia, though it remained unclear if he would accept. Qureia attended the meeting Sunday night but did not comment, Fatah officials said. The parliament speaker "is our only nominee," said Abbas Zaki, a member of the Fatah central committee.
Palestinian officials agreed on Arafat's suggestion of Qureia and asked him to form a new government within 48 hours, said Hanna Amireh, a member of PLO executive committee.
The developments came during a day of heated negotiations set off by Abbas' resignation Saturday. Arafat had refused to grant him more power over the Palestinian security services, capping four months of wrangling between the two since Abbas took office.
Qureia, a moderate who helped cobble together the 1993 Oslo accord between Israel and the PLO, was considered a top candidate to replace Abbas because he has led past negotiations and has credibility with the Israelis. Israeli officials didn't immediately respond to the development.
Earlier in the day, there were conflicting signals about whether Abbas might be pressured to stay on.
A source close to Abbas, speaking on condition of anonymity, said he would serve again only if he could work out a firm deal with Arafat beforehand on what his powers would be and who would serve in his government. Abbas himself sent mixed signals when asked about heading a new government. "It's something premature to talk about. My resignation is final," he said.
The resignation dealt a serious blow to the U.S.-backed "road map" plan for establishing a Palestinian state by 2005; Israel and the United States have refused to deal with Arafat, whom they accuse of fomenting terrorism, and made Abbas, a critic of terror attacks against Israelis, their partner in peace efforts.
U.S. Secretary of State Colin Powell said any Palestinian prime minister must have clear control over security forces and use them to crack down on militant groups like Hamas and Islamic Jihad. "That person has to have political authority and the determination to go after terrorism," Powell said on ABC's "This Week."
The "road map" plan requires the Palestinians to dismantle militant groups. Abbas, despite his strong support for the road map in principle, has refused to do this forcefully, appealing in vain to the militants to disarm.
The Palestinian's leadership crisis came as Israel edged toward all-out war with the militant group Hamas.
One day after a botched strike Saturday against the group's top leaders, Israeli Prime Minister Ariel Sharon that all of the Islamic militant group's members are now "marked for death."
Sunday's missile strike against Musa appeared to confirm the Israelis' determination to make good on Sharon's claim. Hamas has promised to exact revenge for the strikes.
At the same time, a debate brewed over the morality of such "targeted killings" and over whether the militants can be deterred.
The decision to ratchet up the war on Hamas — after the group claimed the suicide bombing last month — has considerable public support.
A power vacuum on the Palestinian side might invite an escalation in violence, with Palestinian militants possibly stepping up attacks and Israel taking more dramatic measures, including the potential expulsion of Arafat from Palestinian areas.
Momentum appeared to grow in Israel for expelling Arafat, with Cabinet ministers arguing that Abbas' resignation proved the 74-year-old Palestinian leader is the main impediment to efforts to end three years of violence.
"As long as Arafat is in the region, he won't let any other leader develop," Foreign Minister Silvan Shalom told Army Radio.
Amos Gilad, a top adviser to Defense Minister Shaul Mofaz, said there was a growing understanding in the United States and Europe that Arafat's departure is a precondition for progress toward peace.
The United States has blocked Arafat's expulsion in the past, and security advisers to Israeli Prime Minister Ariel Sharon have warned that Arafat could do more harm to Israel abroad than by remaining trapped at his West Bank headquarters in the town of Ramallah.
Powell restated U.S. opposition to deporting the Palestinian leader, which would "put him on the world stage as opposed to the stage he is currently occupying."
Israel's recent policy has been to sideline Arafat — but that goal seemed far from reach Sunday as he seized center stage in the search for a new prime minister.
Abbas' resignation must be accepted in writing by Arafat to take effect; while Arafat has not taken this step, he told lawmakers he considered Abbas' Cabinet a caretaker government, implying recognition of the resignation.
In a closed-door meeting that lasted into Sunday evening, Arafat and leaders of his Fatah movement discussed options, and several sources present at the meeting said Arafat made clear his preference for tapping Qureia, also known as Abu Ala.
According to legislator Abdul Fatah Hamayel, Arafat told those present that Abbas "has left us in difficult circumstances." He then turned to Qureia, put his hand on his shoulder, and said, "God help you, Abu Ala, with the coming burden."
Earlier Sunday, Arafat aide Nabil Abu Rdeneh said Arafat hoped to persuade Abbas — also known as Abu Mazen — to remain and form a new government. "Abu Mazen remains Arafat's first choice. But if he insists on maintaining his resignation, there will be a new appointment, and that will be discussed now and tomorrow," Abu Rdeneh said. "Within 48 hours, we will reach a conclusion."
Qureia has long been the No. 3 leader in Fatah, after Arafat and Abbas. Seen as a moderate and a pragmatist, he was a key player in the secret talks that led to the 1993 Oslo accords, which led to Palestinian autonomy in the West Bank and Gaza. He also led the Palestinians in negotiations with Israel during the years that followed.
The 65-year-old politician would be one of the few Palestinians who have credibility with Israel but could also count — at least for the moment — on the important support of Arafat. Although Qureia — like Abbas — has little independent support on the Palestinian street, he is a more savvy political operator who enjoys considerable clout after seven years as parliament speaker.