Egyptian President Hosni Mubarak seemed to speak against recent US demands that Israel halt all settlement construction in the West Bank, in an interview with PBS over the weekend.

When asked whether such building had to stop to secure a peace agreement between Israel and he Arab world, Mubarak told the US television station, "Instead of saying stopping more settlements <sic> - and we heard this many times, now for over 10 years, and never come to a stop - what I can say is that we have to consider the whole issue holistically, to negotiate on the final resolution."

Asked whether Iran plays a destabilizing role in the region, Mubarak voiced support for opposition elements within the Islamic republic, quipping, "I say to Iran, 'if you complain of interventions from external forces in Iran, I would say to you, don't interfere with the home affairs of other Arab countries like Lebanon, like Hamas and others. Since you complain of this external or foreign interference, so don't do it with other countries.'"

He also said that "the whole region should be free of all forms, all types of mass effective weapons… nuclear or not nuclear, whether Iran or Israel." RELATEDMubarak: W. Bank ban only hurdle to clear in Schalit talksEditorial: Mubarak in WashingtonAnalysis: Building Israeli confidence... or not

On the matter of captured IDF soldier Gilad Schalit, Mubarak said that Israel "terms and conditions" were getting in the way of progress, noting that his country was working hard to secure the soldier's release, and that German representatives were also involved in the effort.

Schalit, who the Egyptian president referred to as "our prisoner," was captured by Palestinian operatives in June 2006, and has been held in the Gaza Strip since.

"The deal or the agreement was to take care of Schalit and that Israel would release a number of prisoners, and when this is done we will hand over Schalit to the Israelis," Mubarak told the US television station. "We are still following this. Our intelligence organization is working on that, and we still have hope to conclude this on a good note."

Speaking to US Jewish leaders on Monday, meanwhile, Mubarak said that the deal to return Schalit was within sight, according to several participants at the closed-door meeting.

Several attempts at a deal have fallen apart in the past, but Mubarak characterized the conversations as being at a similar point to those held under former prime minister Ehud Olmert.

Mubarak pointed to the issue of the repatriation of Palestinian security prisoners as a key sticking point, as whether they would be returned to the West Bank, Gaza or abroad has yet to be resolved.

"He expressed some cautious optimism that this thing can be resolved in the not-too-distant future," said one representative of the eight national organizations who participated in the hour-long meeting, speaking anonymously because it was officially off the record. "He thinks there are opportunities out there and that we're 90 percent of the way there."