RIYADH- President Barack Obama met Saudi King Abdullah in Riyadh on Wednesday ahead of a much-heralded speech in Cairo the U.S. leader hopes will help refurbish America's tarnished image in the Islamic world.

After an airport welcome in Riyadh, Obama traveled to King Abdullah's farm where the two men were to hold talks expected to cover the Arab-Israeli conflict, U.S. overtures to Iran and oil.

Shortly after Obama arrived, Al Jazeera television aired a recording by al Qaeda leader Osama bin Laden in which he said the U.S. president had planted seeds for revenge and hatred toward the United States in the Muslim world.

Bin Laden said Obama was continuing in the steps of his predecessor George W. Bush and told Americans to be prepared for the consequences of the White House's policies.

Obama, whose father was Muslim and who lived in Indonesia as a boy, hopes to mend a U.S. image damaged by Bush's wars in Iraq and Afghanistan and the treatment of U.S. military detainees.

He was due to spend the night at the Saudi king's farm before flying to Cairo for his speech to the Muslim world, which will fulfill a campaign promise last year to deliver an address from a Muslim capital early in his administration.

I am confident that we're in a moment where in Islamic countries, I think there's a recognition that the path of extremism is not actually going to deliver a better life for people, Obama told NBC News before he left Washington.

There's a recognition that simply being anti-American is not going to solve their problems. The steps we're taking now to leave Iraq takes that issue and defuses it a little bit, he said, adding that the speech was just a first step in a broader dialogue with the Muslim world on difficult issues.


Obama spokesman Robert Gibbs said earlier the speech was about resetting our relations with the Muslim world.

Al Qaeda second-in-command Ayman al-Zawahri urged Egyptians not to be seduced by Obama's 'polished words' when he makes his planned speech in Cairo. He said in a recording on an Islamist website: Obama ... is not welcome in Egypt.

Washington hopes Saudi Arabia will play a moderating role in the Organization of Petroleum Exporters (OPEC) after oil prices hit a seventh-month high, threatening Obama's efforts to lift the United States out of recession and hasten global recovery.

Obama has said he would discuss oil with King Abdullah and would argue that price spikes are not in Saudi interests.

On Monday, the Saudi cabinet reiterated it saw the fair price at $75-$80 a barrel -- 17 percent above current levels.

The king said $75 would be okay for the simple reason that everyone in OPEC wants $100 or more, said a Saudi government adviser, who asked not to be named.

It's just to make the point that Saudi Arabia will be able to neutralize Iranian and Venezuelan influence in OPEC, he said, referring to leading price hawks in the cartel.

Saudi Arabia, the world's biggest crude exporter, has a nearly 60-year-old bond with the United States based on assured oil supplies in return for U.S. protection for the kingdom.

Saudi Arabia, which has more than a fifth of global crude reserves, wants to hear how serious Obama is about plans to lower U.S. dependence on Middle East oil and diversify energy resources away from fossil fuels, analysts say.

The growing realization among Saudi officials that the Obama administration means what it says about diversifying ... may soon begin to create tensions in the bilateral relationship, political risk agency Eurasia Group said.

Obama said he would tell King Abdullah his country did not plan to eliminate its need for oil imports any time soon.

The king was expected to express his worries that Obama's diplomatic overtures to Iran may rejig regional relationships at Riyadh's expense, diplomats and analysts say.

Saudi Arabia wants Obama to get tough with Israeli Prime Minister Benjamin Netanyahu, who has balked at Palestinian statehood and rebuffed U.S. calls to halt settlement building.

(Additional reporting by Alistair Lyon in Beirut; Editing by Samia Nakhoul)