Thousands of protesters broke through a barbed-wire perimeter protecting the Cairo palace of President Mohamed Morsi on Friday, as his vice-president hinted at a possible compromise aimed at calming the seething crisis dividing Egypt.

A cordon of soldiers prevented the crowd from nearing the palace's main gate, but elsewhere protesters sprayed graffiti on the outside walls saying "Leave, Morsi" and "Down with the Muslim Brotherhood," the movement from which Morsi hails, Agence France Presse correspondents at the scene said.

U.S. President Barack Obama expressed "deep concern" Thursday over the recent deadly political protests in Egypt, in a call to his counterpart Mohammed Morsi, the White House said.

Obama also told Morsi that it was "essential for Egyptian leaders across the political spectrum to put aside their differences and come together to agree on a path that will move Egypt forward," the White House said in a statement.

Egyptian President Mohammed Morsi announced on Thursday that the referendum on the constitutional decree will not be cancelled or postponed, calling on all parties and political figures in the country to join him in a dialogue session on Saturday at the presidential palace.

“The upcoming referendum will decide the constitutional amendment’s fate,” Morsi said in a speech he gave, adding that he will not insist on keeping this decree if an accord is reached with parties that oppose it.

Egyptian troops deployed tanks outside the presidential palace on Thursday as the nation awaited President Mohamed Morsi's first address since streets clashes between his supporters and opponents rocked the capital.

The military set up a barbed wire barrier 150 meters (yards) from the palace, after ordering Morsi allies and foes alike to pull back, an AFP correspondent reporter.

U.S. Secretary of State Hillary Clinton called Wednesday for an open and transparent dialogue in Egypt amid a deepening political crisis over sweeping powers adopted by President Mohamed Morsi.

"The upheaval we are seeing now once again in the streets of Cairo and other cities indicates that dialogue is urgently needed," Clinton told journalists at the end of a two-day NATO foreign ministers meeting in Brussels.

Supporters and opponents of Egypt's President Mohamed Morsi lobbed firebombs and rocks at each other Wednesday as their standoff over his expanded powers and an Islamist-drafted constitution turned violent and left two people dead.

Bloodied protesters were seen being carried away as gunshots could be heard and the fierce political rivals torched cars and set off firecrackers, before riot police were deployed in a bid to end the confrontations.

Egyptians have taken their protests against Islamist President Mohammed Morsi to the gates of his palace, demanding his ouster in scenes not witnessed even during demonstrations that toppled Hosni Mubarak.

An AFP photographer said hundreds of protesters were camped in front of the Itihadiya presidential palace Wednesday morning after it had been besieged the previous night by vast anti-Morsi crowds furious at a November 22 decree expanding his powers.

The United States on Tuesday appealed for restraint on both sides in Egypt as supporters and opponents of President Mohamed Morsi clashed during nationwide protests.

"We would simply urge that protesters express their views peacefully and that they be given the environment, if you will, to protest peacefully," State Department spokesman Mark Toner said.

Tens of thousands of Egyptian demonstrators Tuesday encircled the presidential palace after riot police failed to keep them at bay with tear gas, in a growing crisis over President Mohamed Morsi's decree widening his powers.

The protesters cut through barbed wire a few hundred meters (yards) from the palace, prompting police to fire the tear gas before retreating, allowing demonstrators to reach the palace walls, Agence France Presse reported.

Egypt's foreign ministry on Tuesday summoned Israel's ambassador to Cairo, Yaakov Amitai, to issue a "strong protest" over the Jewish state's plans for new settlements, a ministry spokesman said.

Alaa Eldine Yussef, who heads the Israeli affairs section at the ministry, told the envoy that "the Israeli government's plan contradicts the concept of land for peace, on which peace efforts in the region are built," spokesman Amr Roshdy said.