Secretary of State John Kerry insisted there was "always a way forward" in Israeli-Palestinian peace talks, even as Israeli Prime Minister Benjamin Netanyahu has said he was suspending those talks after Hamas (which has controlled the government in the Gaza Strip since a 2006 election) and Fatah (the ruling party in the West Bank and of the Palestinian Authority) announced a deal to work on a unity government and hold elections next year.
Kerry said Israeli and Palestinian leaders had to "make the compromises necessary," but didn't specify what those were, saying the decisions were up to the leaders themselves. Although currently on a tour of Europe to drum up support for sanctions against Russia over Ukraine, Kerry started his tenure as secretary of state last year by spending months pushing for a restart of Israeli-Palestinian peace talks.
According to a report on Israeli television station Channel 10, Netanyahu had authorized negotiators to talk about the borders of a future Palestinian state, a first. Aides to Netanyahu deny it. Israel suspended peace talks because it identifies Hamas as a terrorist group and oppose its inclusion in any government it would negotiate with. Hamas' prime minister, in turn, blamed Israel's response on the "occupation" and said it didn't want Palestinians to be "united."
A few days before the Fatah-Hamas deal was announced, Palestinian journalist Saud Abu Ramadan suggested in an op-ed that the Fatah-controlled Palestinian Authority's only remaining course of action was to dissolve itself "and thus render the Palestinian territories a state under occupation" which, he argued, would contribute to international pressure on Israel.
An analysis by Dan Perry of the Associated Press suggests three directions the Israeli-Palestinian situation could play out in from an Israeli policy perspective: an agreement on borders for a Palestinian state that would include some compromise on Jerusalem; a unilateral pull-out from the West Bank (as former prime minister Ariel Sharon did in the Gaza Strip), possibly linked with a military occupation; or the eventual emergence of a single state. Perry suggests the third option could happen absent action on the issue, a "logical long-term default." Perry reports Palestinian Authority President Mahmoud Abbas threatened something similar when he told Israeli lawmakers at a recent meeting he'd "hand over the keys" of his government for Israel to deal with.