Soviet Foreign Minister Alexander Bessmyrtnykh said Friday said Moscow is "very close" to renewing diplomatic relations with Israel but rejected Israeli efforts to make bilateral relations a condition to Soviet participation in the Middle East peace process.

"We've decided to be in touch, with intensive contacts between our two countries and foreign ministers," Bessmertnykh told an airport news conference after six hours of talks with Israeli leaders in Jerusalem.He is the first Soviet foreign minister to visit Israel in its 43-year history. Relations between the two countries, broken off by the Kremlin after the 1967 Six Day War, have been warming since the Soviet Union loosened emigration restrictions in 1989 and allowed more than 200,000 Jews to move to Israel.

"Were moving very close to reestablishing diplomatic relations and that will come," Bessmertnykh said before flying to Cairo to meet President Hosni Mubarak and Secretary of State James Baker.

Baker was leaving Washington Friday evening - his fourth trip to the Middle East in two months. A senior U.S. official said in Washington Thursday that Baker's trip would be his last use of shuttle diplomacy to try to get the talks going.

"Our arrival in Israel coincides with a very important period in international history and also in the development of the Mideast region," Bessmertnykh said when greeted by Levy.

"I think the substance of this new phase is that we really have a chance to begin a peace settlement process and to achieve a settlement that will be satisfactory to all nations," he said.

Prime Minister Yitzhak Shamir has said he would welcome joint U.S.-Soviet sponsorship of a regional peace conference between Israel and the Arabs but only if the Soviet Union restores full diplomatic ties.

Bessmertnykh said Thursday the move is being considered, but apart from the peace process. "We do not accept any conditions for our own participation in the peace process," he said.

Levy praised the Soviet foreign minister for his "historic" visit and expressed hope for peace in the Middle East.

In talks Thursday in Amman, Bessmertnykh took a hard line against Jewish settlement in the occupied West Bank and Gaza Strip, which is supported by Shamir's right-wing government.

Bessmertnykh said he "cannot forsee, conceive or accept" a peace conference as long as settlements are being established in the occupied territories.

Israel is worried that the Soviets might curtail the emigration of Jews from the Soviet Union as leverage.

The Israelis have been hoping for a return to full diplomatic relations but Bessmertnykh said the questions of a peace conference and diplomatic relations are separate and that "reconciliation" with Israel would take place "when conditions" are conducive.