Now that the US has taken this position, I don't see any graceful way to back down, so the US won't. Putin has been making overtures to Israel in the wake of the Beslan massacre, but for much longer has been working to reassemble the USSR. Powell is anti-Israel, and Putin is trying to maneuver Russia back into a position of influence in the Middle East.
The EU will have to decide what its position is about the election...
http://www.euobserver.com/?sid=9&aid=17823
So completely backward. It is Sharon who made strong overtures to Putin and Russia. And it is the Israelis who are extending the hand of welcome and love to those from Beslan.