The United States told Palestinian leaders on Friday they must resume talks with the Israelis if they want US help to achieve a peace treaty that ends Israeli occupation and creates a Palestinian state.

Putting the ball squarely in the Palestinian court, US envoy George Mitchell told President Mahmoud Abbas that returning to the table was paramount, chief Palestinian negotiator Saeb Erekat quoted him as saying.
 

Mitchell himself left without comment.
 

With little to show for the past year of diplomacy, US President Barack Obama's Middle East policy now turns on these talks about talks. The Palestinians refuse to talk until Israel stops building settlements on occupied West Bank land.
 

"Mitchell said that if we want help to achieve a final settlement we must resume the negotiations. This was the main point of discussion," Erekat said.
 

"We do not share a common point of view on this issue," he told reporters, blaming the deadlock on the right wing coalition of Israeli Prime Minister Benjamin Netanyahu, who has refused to stop expanding Jewish settlements around Jerusalem.
 

"We want the resumption of negotiations. We are not obstructing negotiations," Erekat said the Palestinians had told Mitchell in the West Bank city of Ramallah on Friday. "Therefore you must work with Netanyahu to remove his conditions."
 

A year ago at the outset of his term, Obama listed a Middle East peace settlement among his foreign policy priorities and initially backed Abbas's demand for a total settlement freeze before talks suspended in December 2008 were relaunched.
 

But Obama later retreated from that position in face of Netanyahu's refusal, and on Thursday he admitted overestimating chances of a Middle East breakthrough; the limits placed on both sides' leaders by their domestic critics - notably Islamist Hamas and Israeli settlers - had hampered a rapprochement.
 

Highlighting tensions, Palestinians in the West Bank village of Nabi Saleh who tried to stage a protest against a nearby Jewish settlement clashed with Israeli soldiers on Friday.

Derailed
In a Time magazine interview, Obama said expectations had been set too high. Mitchell "got blinded" by making some progress on settlements and "didn't see it wasn't sufficient progress for the Palestinians", he said.
 

Israel in November announced a freeze in settlement building other than around Jerusalem for 10 months but despite U.S. pressure Abbas has not relented. Palestinian analysts see a risk of greater violence if people lose hope of an end to occupation.
 

Mitchell said nothing to Palestinian reporters after the talks in Ramallah. Palestinian sources said he planned to meet Netanyahu again on Saturday and would also go on to Egypt, which plays an important role in the mediation process.
 

Erekat said the Palestinians appreciated the U.S. efforts. But Netanyahu had derailed them, he said.
 

"He refused to stop settlement activities, he refused to resume negotiations where we left off", he added, referring to late 2008, when talks with the previous, centrist Israeli government of Ehud Olmert were suspended over the Gaza war.
 

Abbas has shown no readiness to budge from his demand that all settlement building cease, though he hinted recently that a US guarantee of the kind of Palestinian state that would emerge from talks might be enough for him to climb down.
 

Palestinians want all the land Israel seized in 1967, including a capital in East Jerusalem, and the return, or conceivably compensation, for millions of refugees and their descendants, who lost homes in what became Israel in 1948.
 

Israel, however, would be unlikely to accept anything in writing that it would say prejudges the outcome of negotiations.
 

Palestinian analyst George Giacaman of Birzeit University said he believes Obama's Time interview "is a turning point".
 

"It can be read as a way of exasperation, possibly even on the verge of giving up on any credible political process."
 

Obama however told Time he still seeks a treaty to end the 62-year-old Middle East conflict and bring peace to the region.
 

"We are going to continue to work with both parties to recognise what I think is ultimately their deep-seated interest," he told the magazine. The goal is "a two state solution in which Israel is secure and Palestinians have sovereignty and can start focusing on developing their economy and improving the lives of their children and grandchildren".
 

The Palestinians doubt Netanyahu has any intention of agreeing to a state with sovereign borders on the territory captured by Israel in the 1967 Middle East war, with East Jerusalem as its capital. Netanyahu this week made clear that even if he did, he wants Israel to control all its borders.
 

Palestinian Prime Minister Salam Fayyad has said he fears all that is on offer from Netanyahu is a "Mickey Mouse state", entirely surrounded by Israel or its armed forces.
 

Source: Reuters