The U.N. chief said he won assurances from Lebanese authorities that they are serious about enforcing the arms embargo on Hezbollah, and that he believes Israel's security concerns could be addressed in this way.

"We need to be flexible, because I don't think there's ever only one way of solving a problem. We shouldn't insist that the only way to do it is by deploying international forces," he said.

The lifting of the blockade is necessary to help Lebanon's economy recover from the war and to strengthen Lebanon's government. "I do believe the blockade should be lifted," Annan said in a news conference with Olmert.

Olmert sidestepped the issue, saying only that Israel wants to see a full implementation of the cease-fire.

Annan said he is working to increase the size of the international force in Lebanon "as rapidly as possible" and to double the current number to 5,000 quickly. A five-ship Italian fleet departed on Tuesday carrying 800 soldiers and was expected to arrive in Lebanon on Friday.

"We hope that as we do that, the Israeli withdrawal (from Lebanon) will continue and by the time we are at that level, Israel will have fully withdrawn," Annan said.

Olmert said Israel hoped to pull out from Lebanon "as soon as possible," but suggested the deployment of the 5,000 UN troops would not be enough to secure that objective. After meeting with Annan on Tuesday, Israeli Defense Minister Amir Peretz said that "Israel will pull out once there is a reasonable level of forces there." He did not say what that level would be.

Olmert, meanwhile, said he hoped the cease-fire would provide dialogue between Israel and Lebanon.

"I hope the conditions will change rapidly to allow direct contact between the government of Israel and the government of Lebanon to hopefully to reach agreement between the two countries," he said. The deal could be "a cornerstone to build a new reality between Israel and Lebanon."

Israel has long sought a peace deal with Lebanon, but Lebanon has hesitated reaching a separate agreement with Israel as long as Israel's conflicts with the Palestinians and Syria are unresolved.

Both Annan and Olmert demanded the unconditional release of two Israeli soldiers captured by Hezbollah on July 12, the incident that triggered the war. A third Israeli soldier was seized by Palestinian Hamas militants in late June and is being held in Gaza.

Annan said he would do everything in his power to win the release of the three soldiers. He said that in his visit to Lebanon, before coming to Israel, he met with a Hezbollah member of the Lebanese Cabinet and discussed the fate of the soldiers. "I did not get the impression that they are not alive. I believe they are alive," he said.

Israel is the second stop on Annan's 11-day Mideast tour intended to shore up the truce.

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