By Mohammed Ghobari and Mohamed Sudam
SANAA (Reuters) - Yemen's ruling party held open the possibility that President Ali Abdullah Saleh would sign a deal on Sunday that would soon ease him out of office as Washington heaped pressure on the entrenched leader to transfer power.
The move was an unexpected reversal just a day after last-minute snags appeared to derail the deal, which would require Saleh to resign within a month but would grant him immunity from prosecution to ensure a dignified exit.
"Maybe it will be signed on Sunday," a ruling party official said of the deal.
An opposition official said he had not heard any official word on that from Gulf mediators trying to revive a deal they helped forge that they hope will end months of street protests that have paralyzed Yemen's already faltering economy.
The United States and Saudi Arabia, both targets of foiled attacks by al Qaeda's Yemen wing, are keen to end the Yemeni stalemate to avert deeper chaos that could give one of the militant network's most potent arms more room to thrive.
Washington has stepped up pressure on Saleh to sign and implement the deal, and President Barack Obama said in a speech on U.S. policy in the Arab world on Thursday that Saleh needed to "follow through on his commitment to transfer power."
Pressure was also mounting on Yemen from its wealthy oil-exporting Gulf neighbors, whose foreign ministers were expected to meet in the coming days to discuss the situation in their poorer neighbor, possibly as early as Saturday.
"The (Gulf) Cooperation Council informed us of a meeting of Gulf foreign ministers that will be devoted to discussing the special Yemen initiative," said Mohammed Basindwa, an opposition figure tipped as a possible interim prime minister.
Gulf officials could not immediately confirm the meeting.
MINOR CHANGES TO DEAL
Protesters, frustrated their daily rallies have failed to dislodge Saleh who has ruled for nearly 33 years, want him out immediately in the Arabian Peninsula state, which is also facing revolts from northern Shi'ite rebels and southern separatists.
They have threatened to step up their campaign by marching on government buildings, a move that brought new bloodshed last week as security forces fired to stop them. Strikes have brought commerce to a halt in many cities.
"We are in favor of the president's departure from power by any route. So long as the agreement encompasses this, we are for it," said Ali Noman, a street activist in the city of Ibb, south of the capital.
Saleh, who has outlasted previous attempts to challenge his power, indicated in April he would sign the Gulf-brokered deal, but refused to put his name to it in the final hours.
He said at the time he would only sign in his capacity as ruling party leader, not as president.
On Wednesday, the sides agreed again in principle to the deal, with minor changes on who would sign and in what capacity. Saleh, 69, was due to sign in a dual capacity as party leader and president, according to the opposition.
But the deal broke down over who would sign it from the opposition side. Saleh pushed for its leftist rotating head, Yassin Noman, to be the main opposition signatory. The opposition preferred Basindwa, sources close to the talks said.
The opposition, which includes both Islamists and leftists, eventually agreed to have Noman as the first opposition signer while keeping Basindwa on the list of additional signatories. Saleh refused and the deal fell through, the sources said.
The ruling party later said Saleh was willing to sign but wanted to deal only with "legally recognized parties" represented in parliament, seen as a dig on Basindwa, a political independent.
(Writing by Cynthia Johnston; Editing by Jon Boyle)