Prominent West Bank Palestinian Is Murdered as Violence Escalates : Mideast: Noted land dealer made millions selling to Jews; hundreds of Israelis set fire to Arab homes and shops in response to the murder of a settler.

JERUSALEM —  One of the West Bank’s biggest land dealers, a Palestinian who made millions of dollars selling Arab land to Israeli settlers, was murdered Saturday, apparently to prevent further sales, as political violence continued in the region before the start of Palestinian self-government there.

Ahmed Oudeh Arar, 50, was hit on the head by two assailants armed with hatchets as he did last-minute shopping in the West Bank town of Qalqilyah for his daughter’s wedding, planned for later in the day, according to local residents. When Arar drew his gun, they grabbed it and shot him in the head.

Later Saturday, hundreds of Israeli settlers rampaged through several Palestinian towns on the West Bank, setting fire to houses, shops and cars, in response to the abduction and murder Friday of a 23-year-old settler by Muslim fundamentalists from the Islamic Resistance Movement, known as Hamas.

Shooting over the heads of local residents, the settlers set fire to eight houses in El Bireh, north of Jerusalem, and to several shops and half a dozen cars in neighboring Ramallah, according to Israeli military sources. Damage was described as extensive, but no serious injuries were reported.

Thousands more settlers used burning tires to block the main roads through much of the West Bank, stoning Palestinian cars and buses that ventured near. As a calculated display of strength, the maneuver virtually paralyzed half of the West Bank.

Although Israeli military commanders had sent substantial army and police reinforcements to the region in anticipation of the settlers’ angry reaction to the abduction and murder, the security forces appeared unable to halt the settlers’ rampage and could only contain it and limit the attacks on Palestinians.

The murder of Haim Mizrahi from the settlement of Beit El while he was buying eggs near Ramallah on Friday brought sharp warnings from the settlers’ leaders that they intended to assume responsibility now for their security for fear that the government of Prime Minister Yitzhak Rabin had sold them out.

“We feel abandoned by the Israeli government,” said Ron Nahman, the mayor of Ariel, one of the largest Israeli settlements on the West Bank, and a member of Parliament from the opposition Likud Party. “We will have to take care of ourselves in the future. We are going to have to fight, but we are ready.

“The feeling of Arabs is that they can do what they want now because of the agreement with the PLO. And don’t tell us that these people are just Hamas--all of them are of the same breed.”

But Police Minister Moshe Shahal said Israel would not let Hamas and other fundamentalist groups opposed to the accord with the Palestine Liberation Organization upset implementation of the agreement.

“There should be no illusions about our resolve to use the full extent of the law and all our force against those who perpetrate attacks,” Shahal told Israeli Army radio.

Mizrahi’s murder brought to six the number of Israelis killed by Palestinians since the deal was signed Sept. 13; Israeli forces have killed 12 Palestinians in the same period.

Palestinian leader Faisal Husseini said he was saddened by the murder of Mizrahi. “We are so sad about any killing, Palestinian or Israeli, and we hope that these activities will stop,” Husseini said. “I think the assumption of power by the Palestinian authority on the West Bank and in the Gaza Strip will bring these attacks to an end.”

Israel and the PLO reported progress last week in working out the details of the agreement on Palestinian self-government, but the deep hatreds that remain have led to continuing violence. Under the agreement, Israeli troops will pull out of the Gaza Strip and Jericho district between Dec. 13 and April 13.

The murder of Arar in Qalqilyah on Saturday raised fears of a renewed campaign of retribution against Palestinians deemed guilty of collaborating with Israeli authorities during the 26-year occupation of the West Bank and Gaza Strip.

Arar had made a reputed $30 million over the years, according to Palestinian sources, by buying more than 50,000 acres of West Bank land from Palestinians and selling it to Israelis at considerable profit.

The deals won Arar the friendship of many leaders of Israel’s Likud Party, including former Defense Minister Ariel Sharon, and he contributed heavily to its election campaigns.

But Arar’s business also brought him many enemies within his own community, where the sale of land to Israelis is regarded as tantamount to treason.

Arar was reported to be close to completing a large number of deals that would have expanded about 20 settlements.