ASMARA, Eritrea (AP) _ The leaders of Eritrea and Ethiopia have agreed to immediately halt the use of air strikes in their border war, but Ethiopia today ruled out direct talks.

President Clinton talked by telephone with the leaders of the two countries Sunday, deputy press secretary Joe Lockhart said.

While the agreement does not end the border dispute between the Horn of Africa countries, the White House said it ``can help restore the mutual confidence necessary to achieve a peaceful resolution of the conflict as quickly as possible.''

Eritrea welcomed the air-strike ban as a first step toward meeting its call for a halt to hostilities.

``I think the Ethiopian government is beginning to realize that force is not going to solve this problem,'' said government spokesman Yemane Gebreab.

But Ethiopia today reiterated its demand that Eritrea withdraw from disputed land.

``There will be no direct talks or negotiations through third parties before Eritrea withdraws its troops from our territory,'' government spokeswoman Selome Tadesse said in the Ethiopian capital, Addis Ababa.

Ethiopia and Eritrea, one-time allies who less than a decade ago were part of the same country, have battled since early May over several stretches of their common border with the loss of hundreds of lives. No skirmishes have been reported since Thursday.

Ethiopia has insisted that Eritrea withdraw its troops from more than a half-dozen disputed areas, the largest being the 160-square-mile Yirga triangle _ before peace talks can begin. Eritrea has refused, claiming it owns the disputed territory, based on boundaries drawn by Italy when it occupied the country in 1885.

The White House statement said the moratorium on air strikes, as well as threats of air strikes, will continue until ``either party concludes that any prospect for a peace process has come to an end and provides formal advance notice to the U.S. government that it will no longer respect this moratorium.''

Italian envoy Rino Serri met Saturday with Eritrean President Isaias Afwerki and on Sunday with Ethiopian Prime Minister Meles Zenawi.

Other diplomatic efforts were in the works. A delegation from the Organization of African Unity planned to begin a mission later in the week.

Egyptian President Hosni Mubarak also was trying to arrange a cease-fire on the ground, Eritrean Foreign Minister Haile Woldensae said.

Eritrean bombing raids have killed at least 48 civilians in northern Ethiopia. Ethiopian warplanes killed four people at an airport on the outskirts of the Eritrean capital, Asmara.

Commercial flights to Eritrea have been halted since the first bombing June 5. Foreign embassies evacuated thousands of their citizens in chartered flights.

Eritrean rebels were instrumental in helping the Ethiopian People's Revolutionary Democratic Front overthrow a 17-year military regime in 1991, and Eritrea gained independence from Ethiopia in 1993.