WASHINGTON (Reuters) - President George W. Bush and Iraqi Prime Minister Nuri al-Maliki have agreed to set a "time horizon" for reducing U.S. forces in Iraq, despite Bush's long opposition to deadlines for troop withdrawals.

In the closest the Bush administration has come to acknowledging the need for a timeframe for U.S. troop cuts, the White House said on Friday that U.S. and Iraqi negotiators would seek "aspirational goals" for withdrawals.

Bush, an unpopular president waging an unpopular war in the twilight of his tenure, has adamantly opposed setting a schedule for scaling back U.S. forces, even as Democratic presidential candidate Barack Obama has vowed, if elected, to withdraw troops in 16 months.

Playing down the notion it had changed its policy, the White House insisted Bush and Maliki, in a secure videoconference on Thursday, agreed troop cuts would be "based on continued improving conditions on the ground and not an arbitrary date for withdrawal."

U.S. and Iraqi negotiators have been working in fits and starts on a formal Status of Forces Agreement to provide a legal basis for U.S. troops to remain when an U.N. mandate expires at the end of the year.

Maliki, expressing his government's growing confidence as violence has decreased, last week raised the prospect of setting a timetable for U.S. troop withdrawal. But U.S. officials have been more cautious.

The White House said Bush and Maliki aimed to complete a deal by the end of the month.

"The president and the prime minister agreed that improving conditions should allow for the agreements now under negotiation to include a general time horizon for meeting aspirational goals -- such as the resumption of Iraqi security control in their cities and provinces and the further reduction of U.S. combat forces from Iraq," the White House said.

However, the White House dodged questions of whether this meant the pact would include specific dates.

"FINALLY FACING REALITY"

Despite the White House assertion that Bush was sticking to his strategy, Democrat Joseph Biden, chairman of the Senate Foreign Relations committee, said the administration was "finally facing reality."

"I welcome today's announcement that the president has reversed course and dropped his adamant opposition to a timeline for redeployment of American troops from Iraq," he said.

Bush has long insisted that a fixed timeframe for troop withdrawals would help insurgents in their violent campaign to overthrow the fragile Iraqi government.

White House spokesman Scott Stanzel, traveling with Bush in Arizona, said previous talk of timelines has come from Democrats "who wanted to arbitrarily retreat from Iraq."

Troop levels have become a key issue in the November presidential election fight between Obama and Bush's fellow Republican John McCain, who supports the administration's current Iraq strategy. Obama is expected to visit Iraq soon.

McCain saw the Bush-Maliki discussion as proof that a recent troop buildup had succeeded, making a "conditions-based withdrawal" possible, said his adviser, Nicolle Wallace.

The White House took pains on Friday to avoid the words "timetable" or "timeline," terms that war critics have repeatedly used in their push for an Iraq exit strategy.

In keeping with the new terminology, Iraqi government spokesman Ali al-Dabbagh described the Bush-Maliki talks as focused on "outlining a time horizon" for troop departures.

There is strong domestic pressure in Iraq to set dates for a withdrawal of U.S. forces, especially with violence at a four-year low and with Iraqi security forces growing. Maliki's political opponents also want to exploit the issue of an undefined U.S. troop presence in coming provincial elections.

The last of five extra combat brigades that Bush sent to Iraq in 2007 will finish withdrawing next week, leaving 140,000 U.S. troops in the country. Bush had ordered the "surge" of forces to stop Iraq's slide into sectarian civil war.

(Additional reporting by Thomas Ferraro in Washington, David Alexander in Tucson and by Baghdad bureau; Editing by)

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