Palestinian Authority Prime Minister Haniyeh met with Egyptian Intelligence Chief Omar Suleiman in Saudi Arabia on Saturday. In an interview he gave a Saudi newspaper, Haniyeh said he was updated by Suleiman that a "good formula" had been reached concerning the number of prisoners Israel would release in exchange for captured IDF soldier Gilad Shalit.
Hamas spokesman Ismail Radwan told Associated Press Television that there had been progress in the contacts.
"We expect a declaration of a complete deal of releasing Palestinian prisoners for the imprisoned Zionist soldier soon. But this all depends on the Israeli side," he said. "We hope that the results of this deal will be soon, God willing."
But Palestinian negotiator Saeb Erekat, who is close to PA Chairman Mahmoud Abbas, denied the report of a breakthrough.
"I wouldn't say that no progress has been made at all, but the deal is still far away," he told the AP, counseling patience. "They are still far away from reaching an exact number of prisoners, and we urge everybody not to interfere with the Egyptians' work."
Over the last six months there have been numerous reports of an "imminent" deal, none of which materialized.
Olmert, meanwhile, phoned Abbas Sunday to wish him holiday greetings. According to a statement issued by Olmert's office, the two men agreed to push forward in the next couple of days the issues they discussed at their meeting last Saturday night.
Among the issues they discussed were the transferring of $100 million in frozen PA tax revenue held by Israel, the lifting of roadblocks and the release of prisoners.
Although Olmert signaled that he might release some prisoners before the current Id al-Adha holiday, it was later decided that a prisoner release before Shalit was freed would send the wrong signal to the Palestinians.