PARIS, July 1 (Reuters) - Indirect Israeli-Palestinian peace talks have not yet made enough progress to justify the start of face-to-face negotiations, Palestinian Prime Minister Salam Fayyad said on Thursday during a visit to France.

The U.S.-mediated discussions kicked off in May and are due to last four months, with American diplomats seeking to find common ground to bring the two sides to the same table.

We have yet to see the kind of progress that would be able to justify the consideration of ... direct talks, Fayyad said following a meeting with senior European officials over aid.

The issue really is not so much about whether the talks are direct or indirect. The issue is about political progress, he told reporters.

Israeli Prime Minister Benjamin Netanyahu says he wants to move to direct talks without delay and without preconditions and the issue is expected to be raised next week when he visits U.S. President Barack Obama in Washington.

Palestinian President Mahmoud Abbas has called for a full freeze of Israeli settlement building in occupied land before full-fledged negotiations begin. He has also called for more movement from Netanyahu on border and security issues.

Egyptian Foreign Minister Ahmed Aboul Gheit, who was also at the Paris meeting, said that if the Israeli-Palestinian discussions got nowhere, Arab leaders would push the United Nations to back the creation of a Palestinian state.

U.N. MAY TACKLE INDEPENDENCE CALL

If the proxmity talks don't bring progress by September ... then the Arab League foreign ministers would agree on the need to act in the Security Council, he said.

The state should not be delayed beyond this year. Who should decide? The Quartet is not enough, The Security Council is the venue, he added.

The Quartet of Middle East mediators -- the United Nations, Russia, the United States and the European Union -- are also involved in trying to broker a Middle East peace deal.

The group's envoy, Britain's former Prime Minister Tony Blair, told reporters he would return to the region next week, adding that he expected clarification very shortly from the Israelis over their blockade of the Gaza Strip.

Israel strictly controls the borders of Hamas-ruled Gaza in what it says is a precaution against arms smuggling, but it has moved to ease the blockade following an outcry over its lethal raid on a Turkish aid ship that tried to break the embargo.

Under a previous policy, Israel banned all but a list of permitted goods. Now, it is preparing to allow in everything except arms and problematic dual use materials.

The discussion on that continues and I hope that very shortly, although don't hold me to that, in the next few days, we will be in a position where there will be such a finalised list, Blair said.

Once that happens it will create a wholly different framework for operations, he added. (Reporting by Crispian Balmer; editing by Noah Barkin)