US Secretary of State Hillary Clinton has urged the Israelis and Palestinians to restart talks "as soon as possible".
Mrs Clinton was speaking after meeting Israel's Prime Minister Benjamin Netanyahu in Jerusalem, in a new drive by the United States to restart the region's peace process, the BBC reports.
Palestinians said Israel must freeze settlement building in the occupied territories before talks can resume.
But Mr Netanyahu said this was a "pretext and an obstacle" to prevent the renewal of negotiations.
At a news conference on Saturday with Mrs Clinton, the Israeli premier called for the talks to restart "immediately". He said the Palestinians had never before put forward a precondition for peace talks linked to the settlements issue.
Mrs Clinton agreed, adding: "What the prime minister (Netanyahu) has offered in specifics on restraints on a policy of settlements ... is unprecedented in the context of prior to negotiations."
"I want to see both sides begin as soon as possible in negotiations," she said.
Earlier in day, Mrs Clinton met Palestinian Authority President Mahmoud Abbas in Abu Dhabi.
A senior Palestinian official said the talks had yielded no breakthrough, with Mr Abbas reiterating the Palestinian position.
Mrs Clinton's trip to the Middle East trip comes 10 days after she reported back to US President Barack Obama on the peace process, suggesting it was too early to launch fully-fledged talks.
