Damascus: Syrian President Bashar Al Assad yesterday said that America's plan for a "new Middle East" collapsed after Hezbollah's successes in fighting against Israel, and warned the Jewish state to seek peace or risk defeat in the future.

Bashar, speaking to a journalists' association conference, said the region had changed "because of the achievements of the resistance [Hezbollah]."

"The Middle East they [the Americans] aspire to ... has become an illusion," he said.

US Secretary of State Condoleezza Rice said early in the war between Hezbollah and Israel that any settlement should be durable and lead to a "new Middle East" where extremists have no influence.

But after 34 days of fighting, a ceasefire brought a fragile truce, with Hezbollah surviving and Israeli forces unable to score a decisive victory.

"We tell them [Israelis] that after tasting humiliation in the latest battles, your weapons are not going to protect you not your planes, or missiles or even your nuclear bombs ... The future generations in the Arab world will find a way to defeat Israel," Bashar said.

He warned Israeli leaders to give up on their "follies and arrogance" and work for peace.

"They should know that they are before a historic crossroads. Either they move toward peace and the return of [Arab] rights or they move in the direction of continued instability until one generation decides the matter," he said.

The fighting in Lebanon had been planned by Israel for some time, Bashar said, but the endeavour failed.

"The result was more failure for Israel, its allies and masters," he said.

Bashar defended Hezbollah and said Syria was proud to support it. He criticised a UN ceasefire resolution for holding the Syrian-backed group responsible for the violence.

"Israel is the one who is responsible," he said. He added that Israel's supporters in Lebanon an allusion to the anti-Syrian parliamentary majority in Beirut also bear responsibility.

"The resistance is necessary as much as it is natural and legitimate," he said.

Bashar said this war revealed the limitations of Israel's military power.

In a 1982 invasion of Lebanon, Israeli forces surrounded Beirut within seven days of invading, he said. "After five weeks it [Israel] was still struggling to occupy a few hundred metres."

"From a military perspective, it [the battle] was decided in favour of the resistance [Hezbollah]. Israel has been defeated from the beginning," Bashar said. "They [Israelis] have become a subject of ridicule."

Bashar also lashed out at Arab governments, without naming them, who have criticised Hezbollah for kidnapping two Israeli soldiers and starting the war. Saudi Arabia, Egypt and Jordan criticised Hezbollah's actions at the start of the conflict.

"We do not ask anyone to fight with us or for us ... But he should at least not adopt the enemy's views," Bashar said.

Syria has been sharply criticised by Washington, and US officials have called on Damascus and its ally Iran to withdraw support for Hezbollah. Syria has rejected such demands.

The Syrian leader said US participation was needed for a peace settlement in the Middle East, but he said peace cannot be achieved under the administration of US President George W. Bush.

"This is an administration that adopts the principle of pre-emptive war that is absolutely contradictory to the principle of peace," he said. "Consequently, we don't expect peace soon or in the foreseeable future."

Midway through Bashar's speech, members of the audience who said they were Lebanese stood up and loudly thanked him.

"Without the support of our sister country Syria, we would not be able to achieve what we have achieved," one woman screamed.

The audience then broke into applause and shouts in praise of Bashar and Nasrallah. "With our blood, with our soul, we redeem you, Oh Bashar!"