The Israeli-Palestinian peace talks, which resumed last month after a breakdown of nearly two years, have already run aground over Israel's refusal to renew a moratorium on West Bank settlement construction.

“I don't know a single minister in the septet who thinks it's possible to reach a deal in the foreseeable future,” said Deputy Prime Minister Moshe Yaalon.

Yaalon was referring to the seven-member decision-making body in Prime Minister Benjamin Netanyahu's Cabinet.

Yaalon, speaking to Army Radio, accused the Palestinians of being intransigent and of carrying out repeated violence and incitement since 1993, when the two sides signed their first, interim peace accord.

He claimed the Palestinians have refused to declare an end to their conflict with Israel, even under a peace deal, suggesting that further demands for territorial concessions could follow.

However, an official in the prime minister's office disputed Yaalon's take on the matter, noting that Netanyahu, who leads the septet, had reiterated his goal of reaching peace within one year during a parliamentary speech on Monday.

“He believes firmly that if both sides show creativity and flexibility and are ready to take tough decisions, then peace is possible. But it has to be a two-way street. It can't just be the Palestinians making demands and Israel making concessions,” said the official. He spoke on condition of anonymity because he was not authorized to respond to another minister's public comments.

Meanwhile, The European Union on Tuesday urged Israel to guarantee the equality of all its citizens after Prime Minister Benjamin Netanyahu urged Palestinians to recognize Israel’s Jewish identity.

Asked to comment on Netanyahu’s call for the Palestinian leadership to recognize Israel as the national state of the Jewish people, a spokeswoman for EU diplomatic chief Catherine Ashton said: “We support the two democratic states living side by side in peace and security. “We also stress that the future states of Palestine and Israel will need to fully guarantee equality to all their citizens,” she added.

“Basically in the case of Israel this means whether they are Jewish or not,” said spokeswoman Maja Kocijancik.

Meanwhile, Netanyahu’s offer of a freeze on settlement building in exchange for Palestinian recognition of Israel’s Jewish identity was widely seen on Tuesday as a ploy to complicate US-backed peace efforts.

Netanyahu’s proposal was little more than a “major diversionary ploy” cooked up in order to ease the crisis over the expiry of the freeze, the left-leaning Haaretz newspaper said in a scathing editorial.

Top-selling daily Yediot Aharonot said it was “implicit” from Netanyahu’s speech that he was “going to do everything to torpedo the negotiations with the Palestinians at their current stage. “Netanyahu is searching for any possible trick to push the Palestinians into the position of being rejectionists,” wrote Shimon Shiffer in an analysis headlined: “The Derailer.”

A renewal of the ban on Jewish settlement building on occupied Palestinian land, which expired on Sept. 26, is largely seen as the key to reviving the moribund peace talks that began three weeks earlier.

“When he demands that Abbas recognize Israel as a state of the Jewish people, he is offering assisted political suicide to the Palestinian leader,” wrote Haaretz commentator Akiva Eldar.

Acknowledging that would be tantamount to “an upfront concession on the right of return,” he said.

“Netanyahu understands that this is an asset that is too precious and too complex for the Palestinians to just give up for cheap — namely, a temporary, partial freeze on construction in settlements.”

For one senior member of Netanyahu’s right-wing Likud party, the premier’s maneuver had practically ruled out any renewal of a building freeze in the West Bank.

“His proposal pushes off a building freeze and talks with the Palestinians,” the Likud official told the Yediot.

“Negotiations with the Americans are at an impasse, so Netanyahu came up with a proposal to show that he is willing to continue the talks, but it is clear that the Palestinians will not agree.

“Therefore, there is virtually no chance that the construction freeze will be reinstated,” he said.

In Brussels, European diplomatic chief Catherine Ashton, asked for a reaction, said “we support the two democratic states living side by side in peace and security.

“We also stress that the future states of Palestine and Israel will need to fully guarantee equality to all their citizens,” she added.

“Basically in the case of Israel this means whether they are Jewish or not,” said spokeswoman Maja Kocijancik.