Syrian forces besiege rebel-held Aleppo as Turkish-backed fighters drive Islamic State from border

A deal could be announced as early as Sunday, a senior U.S. State Department official said on the sidelines of the G20 summit in the eastern Chinese city of Hangzhou.

"We're not there yet," Obama told reporters after a meeting with UK Prime Minister Theresa May, noting previous ceasefires had failed to last for long.

Military officials from the United States and Russia, which back opposite sides in Syria's five-year war, have been meeting for weeks to try to work on terms of a deal.

The civil war has killed more than 250,000 people and displaced 11 million, causing a refugee crisis in the Middle East and Europe, and contributing to a rise in militant Islamist groups.

"We have grave differences with the Russians in terms of both the parties we support but also the process that is required to bring about peace in Syria," Obama said.

Russia has backed Syrian President Bashar al-Assad, but the United States has worked with moderate opposition forces fighting Assad.

"But if we do not get some buy-in from the Russians on reducing the violence and easing the humanitarian crisis, then it's difficult to see how we get to the next phase, he said.

The White House has said Obama and Russian President Vladimir Putin likely would have the chance to talk informally on the sidelines of the G20. No time for that meeting has been announced.

(Reporting by Roberta Rampton; Writing by Nicholas Heath; Editing by Kim Coghill)