White House says 'disagreements' remain after Netanyahu talks

AFP - Talks between President Barack Obama and Israeli Prime Minister Benjamin Netanyahu have failed to resolve "disagreement" thwarting US efforts to revive Middle East peace talks, the White House said Wednesday.

Obama asked Netanyahu during two high-stakes meetings late Tuesday to take specific "confidence-building" steps to boost indirect talks Washington is trying to arrange with the Palestinians.

"There are areas of agreement. There are areas of disagreement, and that conversation is ongoing," White House spokesman Robert Gibbs said.

Meanwhile, before boarding a plane back to Israel, Netanyahu said: "We think we have found a golden way that would allow the Americans to move the peace process forward while preserving our national interests".

In a sign of the fragile state of US-Israeli relations amid a fierce public row over settlements, the White House did not offer Netanyahu the normal trappings of a foreign leader's visit, a photo-op or joint press appearance.

Glossary: The Mideast conflict from A to Z

Gibbs said the discussions were "honest and straightforward," a diplomatic euphemism hinting at tensions, after Netanyahu went into the talks having laid down a hard line on settlement construction in annexed east Jerusalem.

The White House did not even characterize the talks until Gibbs spoke, 15 hours after the Israeli prime minister left and unusually, did not release an official photo of the closed-door talks.

Netanyahu's office however said the two rounds of talks between the key allies had unfolded in a "good atmosphere."

Despite the failure to reach agreement, US Middle East envoy George Mitchell was due to meet Netanyahu in Washington later Wednesday, following more official contact between the two delegations, Gibbs said.

But there were so far no plans for Obama and Netanyahu to meet again, he added.

"The president has asked the prime minister for certain things to build confidence up to proximity talks that we think can make progress," Gibbs said.

"I am not going to get into the substance yet of the meeting."

Obama and Netanyahu met at the White House with ties between the two allies severely rattled by an Israeli decision to construct 1,600 more Jewish settlements in east Jerusalem, which Palestinians see as their future capital.

The Israeli leader on Tuesday made clear that US demands for a settlement freeze could delay the resumption of Middle East peace talks for a year, a day after a fiery speech in which he said "Jerusalem is not a settlement."

"If the Americans support the unreasonable demands made by the Palestinians regarding a freeze on settlements in east Jerusalem and the West Bank, the peace process risks being blocked for a year," Netanyahu said.

"Relations between Israel and the United States should not be hostage to differences between the two countries over the peace process with the Palestinians," he was quoted as saying by Israeli media.

Netanyahu left the White House, with little fanfare, and did not even glance at reporters late Tuesday, his departure symbolizing his government's growing estrangement from its major allies.

As the prime minister sparred with Washington, his government was also trying to douse a crisis with Britain, after the London government expelled an Israeli diplomat over a row over faked UK passports.

Britain said Tuesday there were compelling reasons to suggest Israel was behind the forgeries used by the team which killed Hamas commander Mahmud al-Mabhuh in Dubai in January.

Notably, Obama discussed the latest tensions on the Middle East with British Prime Minister Gordon Brown, French President Nicolas Sarkozy and German Chancellor Angela Merkel in a secure video conference on Wednesday.

The talks also focused on the next steps the international community could take on another key issue that concerns Israel -- Iran -- as Washington seeks a toughened range of sanctions over the Islamic Republic's disputed nuclear program.

The row between Washington and Israel erupted when -- during a visit to Israel by Vice President Joe Biden -- Netanyahu's government announced the construction of 1,600 settler homes in the east Jerusalem.