BUCHAREST, Romania?Secretary of State Colin Powell voiced qualified support on Tuesday for Israeli retaliation for terror attacks and said Yasser Arafat must do more to control Palestinian terrorist groups.

But he also cautioned against a further escalation of the violence, saying every attack and counter-attack makes peace harder to achieve.

Powell met with Israeli Foreign Minister Shimon Peres on the sidelines of a 55-nation European anti-terrorism conference and told him the United States would remain engaged in the Middle East despite the escalation of violence that has dimmed peace hopes.

He told reporters that Prime Minister Ariel Sharon, in ordering counter-strikes, “is responding in a way that he believes is appropriate to defend his people and to defend his country.”

Israeli strikes were “more of a warning than a punishment,” Peres said.