Seeking to bring down the temperature in a deepening row involving the United States, Israel and Palestine, Secretary Hillary Clinton said, “We have an absolute commitment to Israel’s security… [and] a close, unshakable bond between the United States and Israel.”

However “that doesn’t mean that we’re going to agree,” she added, in a reference to a March 9 Israeli announcement of further housing construction East Jerusalem, which came even as Vice President Joe Biden was in the region to build momentum for talks with Palestine.

The construction of Israeli dwellings on disputed territories has traditionally been a combustion point for the brittle relationship between Israel and Palestine; early on in his tenure President Obama petitioned Israeli Prime Minister Benjamin Netanyahu to halt further construction to give peace in the Middle East a chance.

Earlier this month the Vice President and the U.S. Special Envoy to the Middle East George Mitchell were in Jerusalem and Ramallah to take forward plans for indirect peace talks, the first in over a year, between Mr. Netanyahu and Palestinian President Mahmoud Abbas.

However in what appeared to be a snub to Mr. Biden and Mr. Mitchell the Israeli Interior Ministry announced that permission had been granted for 1,600 new housing units in East Jerusalem. In a strongly worded reaction Mr. Biden said, “I condemn the decision by the government of Israel to advance planning for new housing units in East Jerusalem.”

He said the substance and timing of the announcement was precisely the kind of step that undermined the trust needed right now and “runs counter to the constructive discussions that I’ve had here in Israel.” It was important to build an atmosphere to support negotiations, not complicate them, he added.

A few days later Mr. Netanyahu admitted that that the announcement of the new tenements plan during Mr. Biden’s visit had been “regrettable” and “hurtful,” according to reports – which also suggested that the announcement had even caught Mr. Netanyahu off-guard. The Israeli Prime Minister was also quoted as saying that his government would “examine the chain of events and to ensure procedures” to prevent such an episode from occurring in the future.

However there was no mention of a retraction of the housing construction plan, an omission that clearly angered Secretary Clinton.

On March 12 the State Department reported that she had spoken to Mr. Netanyahu to reiterate the U.S.’s “strong objections” to the announcement in terms of timing and substance; to make clear that the U.S. considered the announcement “a deeply negative signal about Israel’s approach to the bilateral relationship – and counter to the spirit of the Vice President’s trip”; and to reinforce that this action had “undermined trust and confidence in the peace process, and in America’s interests.”

Ms. Clinton’s call apparently did not come without consequences: this week Israeli media quoted Michael Oren, Israel's Ambassador to the U.S, as having told other Israeli officials that U.S.-Israeli relations were at their lowest point since 1975.

On Tuesday Ms. Clinton refuted the claim, saying “Oh, I don’t buy that.” She said that although the U.S. had expressed its dismay and disappointment it was also “committed to achieving the two-state outcome that is the goal.”

In an indication that the ball may lie in Mr. Netanyahu’s court she said, “But I think we’ll see what the next days hold and we’re looking forward to Senator Mitchell returning to the region and beginning the proximity talks.”

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