Two days after the President of the United States gave a major Middle East policy speech, peace efforts are in crisis.
Senior officials in the Palestinian Authority say the peace process has hit a dead end, after Israeli Prime Minister Benjamin Netanyahu rejected President Barack Obama's call for a Palestinian state based on the 1967 borders. Netanyahu says the 1967 border lines are indefensible, and such a withdrawal would leave major Israeli settlement blocs outside of sovereign Israel.
Saeb Erekat, an aide to Palestinian President Mahmoud Abbas, says negotiations with Israel are pointless.
"Netanyahu, very clearly, when given the choice between settlements and peace, he had chosen settlements," said Erekat. "When he was given a choice by President Obama between the past and the future, he has chosen the past."
Another senior Palestinian official, Nabil Shaath, says his side will pursue United Nations recognition of a Palestinian state in September, without Israel's approval. President Obama rejected that idea in his policy speech on Thursday, saying unilateral moves would not help the Palestinians achieve their goals.
Israel's Deputy Prime Minister Dan Meridor says without peace talks, the Palestinians will get nothing.
"The idea that they will be able to have a state that will control a certain area, that this can be done without negotiations, will not fly; and I think this is [an] illusion by them," Meridor said.
Israeli security officials have warned that if the U.N. recognizes a Palestinian state in September, and there are no changes on the ground, it could lead to a new eruption of violence.