President George W Bush said on Saturday that America's change of strategy in Iraq had sharply reduced violence and the United States was on track to complete the withdrawal of 20,000 troops by mid-year.

After talks at a base in the Kuwaiti desert with his military commander in Iraq, General David Petraeus, and the US ambassador in Baghdad, Ryan Crocker, Bush said security gains in Iraq 'are allowing some US forces to return home'.

'Any additional reductions will be based on the recommendations of General Petraeus,' he said.'Conditions on the ground will be those that guide his recommendations. I need to know his considered judgment to make sure that the security gains ... remain in place.'    

Bush said last year's new strategy, which involved a 'surge' in troop numbers and a focus on counter-insurgency warfare, had dealt 'heavy blows' to the al Qaeda network in Iraq. 'Iraq is now a different place,' he said. 'Levels of violence are significantly reduced. Hope is returning to Baghdad.'    

Conceding that until last year, 'our strategy simply wasn't working', he added: 'The new way forward ... changed our approach in fundamental ways.'    

With the Iraq war nearing the five-year mark, Bush has refused to discuss any further troop cuts for now, saying that will depend on his commanders' judgments. The limited phased withdrawal of 20,000 troops was announced by Bush in September.

But he gave a sense of the long-term US commitment when he said in a television interview on Friday that the United States would have a presence in Iraq that could 'easily' last a decade.

The war remains deeply unpopular among Americans, keeping Bush's approval ratings stuck around 30 percent and below. But a fall in violence has taken much of the steam out of efforts by Democratic congressional leaders to try to link war funding to troop withdrawal timetables, something Bush refuses to accept.

Most Democrats still maintain, however, that dramatic changes are needed in Bush's Iraq strategy. Petraeus is due to report to the US Congress in March on whether more troop reductions are advisable. He said last month that security gains were fragile and still reversible without political reconciliation between warring sects to cement them.

Despite heavy US pressure, Iraq's main Shi'ite, Sunni Arab and Kurdish political blocs have failed to agree on key laws seen by Washington as crucial to bridging the sectarian divide.

Bush arrived in Kuwait on Friday evening after wrapping up his first presidential visit to Israel and the occupied West Bank, emboldened enough to have predicted a peace treaty within a year but with no major breakthroughs for his efforts.

He had dinner with Kuwait's ruler, Sheikh Sabah al-Ahmad al-Sabah, who thanked Bush for his efforts to make progress on issues crucial to the Middle East. Kuwait was the first of five Arab countries Bush will visit and which he hopes to enlist to help contain Tehran's growing regional clout.

US Secretary of State Condoleezza Rice said talks would now turn to 'the threats that we've seen in the Gulf, the problem of extremism, whether it be extremism from al Qaeda, Sunni extremism, or whether it be Iran and its tentacles, like Hezbollah and the part of Hamas that Iran supports'.

Gulf states have battled al Qaeda militants in recent years, but they are also concerned about the crises in Lebanon and Iraq, as well as the standoff over Iran's nuclear programme.

Local media said Kuwait's emir would tell Bush of his concerns that a US strike on nearby Iran would destabilise the Gulf, key to world oil supplies.

Bush is likely to hear a similar message from other Gulf Arab leaders who want to curb their Shi'ite Muslim neighbour's nuclear programme without resorting to war.

Kuwait has said it will not allow the United States to us