2011 was a year of stalemate in the Israeli-Palestinian peace process. International mediators tried to revive direct peace talks amid political uncertainties caused by rifts in the Palestinian leadership and popular uprisings in several Arab nations.
The Palestinian Authority, frustrated over the stalled peace talks, applied for full membership in the United Nations. Its case is pending, though it faces stiff U.S. opposition.
But the Palestinians successfully gained admission to the United Nations cultural organization UNESCO, angering Israel and the United States.
Israel took steps to build more housing in areas captured during the 1967 Mideast War.
The Mideast Quartet of big-power mediators tried, unsuccessfully, to get Israel and the Palestinians to resume direct negotiations.
Israel said it was prepared to resume direct talks without pre-conditions, but the Palestinians said direct negotiations were impossible as long as Israel continued to build settlements in the occupied West Bank.
The head of the Palestinian Academic Society for the Study of International Affairs (PASSIA) research group, Mahdi Abdel Hadi, said Palestinians are pessimistic about the prospects for peace.
"We realize that for the coming decade we will continue bleeding because there is no progress in any direction," he said. "Washington is not there, Europe is too busy, the Arab world is divided. And with this labor pain of the new system in the making we will continue confronting and challenging on the ground the Israelis."
Israeli columnist Danny Rubinstein has similar misgivings about the Israelis.
"Because this government is not ready to do anything," Israelis also are pessimistic, he said. "And the problem is not government. The problem is the people. The Israeli people have become more and more hardliner, right wing."
Palestinian leader Mahmoud Abbas and his Fatah movement sought to end the rift with rival Hamas, the Islamist group that controls the Gaza Strip. Leaders of the two groups said they wanted to reconcile and hold new elections in the Palestinian territories.
Israel said it would abandon peace moves if the Palestinians reconciled because Hamas wants to destroy Israel.
But the Israeli government released more than 1,000 Palestinians in exchange for one Israeli soldier, Gilad Shalit, who had been captured by Hamas five years before.
Gaza-based analyst Mahmoud Ajrami said the exchange boosted Hamas's popularity and weakened support for Abbas among Palestinians.
"This gives more hope and reality that with resistance, and only with resistance, we can restore our rights," he said.
Concern grew in Israel over the expanding power of Islamists following popular uprisings in a number of Arab states.
Israeli Prime Minister Benjamin Netanyahu said he feared the winds of change would fuel anti-Israel sentiment and threaten stability.
"The whole area around us is unstable," he said. "It is a political and security earthquake whose outcome we still do not know. In this kind of situation, more than any other time, we have to make sure that we have strong, fundamental security."
Columnist Rubinstein disagreed, explaining that the Islamist parties that won in Tunisia and Egypt have popular support and that Israel and the West should engage them.
"I am not afraid of them because I know they are not crazy," he said. "They are not Taliban and they are not al-Qaida. They are like the Turkish Islamic movement. They are practical."
PASSIA's Abdel Hadi said the Islamist movement was changing and beginning to participate in democratic society, but that it wouldn't abandon the Palestinian cause.
"We have been the core of the Arab cause," he said. "Since World War I, 1914, the Arab revolt of 1916, 1917, all the process, with Gamal Abdel Nasser, with the political Islam, we have been there at the core."
Analysts disagreed on how the popular uprisings in Arab states might change the Middle East. But most agreed that the Israeli-Palestinian deadlock did not bode well for peace and stability in the region.