ERUSALEM, June 24 — Delighted with President Bush's speech, Israeli officials expressed the hope tonight that perhaps, at last, Yasir Arafat would be ousted and a new, peace-seeking Palestinian leadership installed.
But Ismail Abu Shanab, a leader of the militant group Hamas, which has been behind several recent suicide bombings, expressed a different hope: that perhaps, at last, Yasir Arafat and his Palestinian Authority would let real Palestinian violence explode.
"I hope the Palestinian Authority will now understand that it should support resistance and not chase after the West," said Mr. Abu Shanab, an engineer in Gaza City, observing that Mr. Arafat had now "lost the support of the American administration" along with that of average Palestinians.
Palestinian officials were as stunned by the speech as Israelis were pleased. The Palestinians had hoped that Mr. Bush would urge an Israeli withdrawal, but they heard him talk instead about Israel's need to defend itself.
During the Clinton administration, Mr. Arafat was cultivated as the one Palestinian strong enough to deliver peace and a two-state solution to the Israelis. That administration resisted calls for democratic reform as potentially weakening to their standard-bearer.
Mr. Bush, who has refused even to shake Mr. Arafat's hand, officially reversed that policy today, pointing to Mr. Arafat as the central obstacle to progress.
In the view of Israelis and Palestinians, Mr. Bush today embraced a condition sought by Prime Minister Ariel Sharon of Israel that the Bush administration had so far resisted: That no substantive negotiations toward peace can take place until Mr. Arafat goes.
"Tonight, the president announced the official political death of Yasir Arafat," a senior Israeli official said.
He added: "I thought all the way through the speech, this is the carrot, now comes the stick. There was no stick — because we don't deserve the stick."
Indeed, Mr. Bush softened previous demands on Israel. In a speech on April 4, Mr. Bush called for "immediate action" to ease Israel's blockades of Palestinian areas. Since then, those blockades have tightened. But tonight Mr. Bush asked only that Israel restore freedom of movement to "innocent Palestinians" as "violence subsides."
"The choice here is stark and simple," Mr. Bush said, invoking a biblical injunction to choose life over death. "The time has arrived for everyone in this conflict to choose peace and hope and life."
But some Israeli politicians said that things in the Middle East were not necessarily simple. "I am willing to take my chances and say that the speech will not result in anything," Shlomo Ben Ami, a former foreign minister who opposes the current government, told Israel Radio. "At times I think he is talking about Switzerland and not about the Middle East."
Just today, in anticipation of American demands for change, Mr. Arafat had sent Washington and Arab capitals a six-page memorandum outlining a proposal for a "100-day" plan of reform.
It outlines steps to rationalize the Palestinian security system, separate its branches of government, and "renounce fanaticism in the educational curricula and spread the spirit of democracy, enlightenment, and openness," according to a copy provided to The New York Times.
It calls for new presidential and legislative elections no later than January.
But in his speech at the White House today, Mr. Bush went far further, calling not only for new elections but also for a specific outcome, the election of a new leadership "not compromised by terror." For the first time, an American administration made the creation of a Palestinian state conditional on the removal of Mr. Arafat.
Mr. Bush made his speech on a day that Israel stepped up its latest West Bank offensive and killed six Palestinians with a missile strike on Palestinians it said were militants in the Gaza Strip. Once again tanks and troops were dispatched to encircle Mr. Arafat's compound in Ramallah.
[Early on Tuesday, two Palestinian policemen were killed in the West Bank city of Hebron when Israeli troops stormed the Palestinian government headquarters there, The Associated Press reported.]
After invading Ramallah, Israeli forces held six of the eight major Palestinian cities and towns under round-the-clock curfew. After two suicide bombings in Jerusalem killed 26 Israelis last week, the Israeli government announced plans to seize Palestinian-controlled territory until the attacks cease.
Mr. Bush's call for a new Palestinian leadership uncompromised by terror raised one immediate quandary. There are no Palestinian leaders with any sizable following today that Israel regards as free of links to terrorism, either by long association with the Palestine Liberation Organization or as a result of their roles in the present conflict.
Indeed, the conflict has so embittered both peoples that it is conventional wisdom among Palestinian politicians and analysts that anyone who replaced Mr. Arafat now, lacking his history and credentials, would have to be even more extreme to sustain broad support.
But it is also conventional wisdom among Israelis that no real Palestinian reform is possible, and with it no progress toward peace, as long as Mr. Arafat remains in charge.
"There hasn't been any attempt for real reform," said Raanan Gissin, a spokesman for Mr. Sharon, before Mr. Bush's speech. "This is all cosmetic reform, and an attempt to satisfy the United States."
As officials at the upper reaches of both governments maneuvered anxiously for position in advance of Mr. Bush's speech, a sense of routine, even boredom, pervaded the Israeli actions on the ground. In Ramallah, in what is becoming ritual, Israeli soldiers fanned out through the streets, detaining dozens of men and leading them away at gunpoint.
"In the past, we used to be afraid of being harmed or losing some business," said Muhammed Ali Rushdi, 39, defying the curfew to sit outside and eat watermelon with two friends on an otherwise empty sidewalk. "Now, there's nothing left to be afraid of."
In contrast to Israel's previous West Bank offensive earlier this spring, there has been little Palestinian resistance this time. Before, Israeli armored vehicles and tanks traded rounds with Palestinian gunmen on foot, and barrages of gunfire echoed off the surrounding hills. Today, almost no gunfire was heard, and soldiers seemed almost relaxed as they moved through the Palestinian refugee camp of Al Amari.
One of Mr. Rushdi's companions, Amjad Albatta, 30, said the Palestinian militants had learned to wait the Israelis out, rather than to confront their overwhelming forces. "This is evidence that the Israelis don't know what they're doing," he said. "They're trapped. How many plans have the Israelis had against my people? And all of them failed."
Mr. Arafat remains by far the most popular Palestinian leader. Recent polls suggest he would win if he ran again for president.
But his authority is eroding, in ways, his aides suggested, that should concern Israelis. The Palestinian outline for reform shows that the Palestinian Authority has changed its plans and decided to hold municipal elections by March, rather than before the presidential and legislative elections.
The reason, a senior Palestinian official said, was that Mr. Arafat and his aides feared that Hamas would do extremely well in the local elections and then carry that momentum into the more general campaigns.