Israeli, Palestinian, and U.S. mediators are scrambling to reach a compromise that would prevent fragile Middle East peace talks from collapsing after a freeze on Israeli settlement building expires later today.
The 10-month freeze, which in effect has only been a slowdown in Israeli building in the occupied West Bank, expires today at midnight (2200 GMT).
Israeli Prime Minister Binyamin Netanyahu has said the construction freeze will not be extended, despite an appeal from U.S. President Barack Obama.
Despite Netanyahu's call on West Bank settlers to "show restraint," settlers today held a cornerstone-laying ceremony for new homes in the region's Revava settlement as a symbolic way of celebrating the end of the building slowdown. The event was organized by Netanyahu's right-wing Likud party.
Several thousand settlers were also expected later today at a rally to count down the hours to the settlement freeze's expiry.
Palestinian Authority President Mahmud Abbas has threatened to walk out of the peace talks, launched at the White House less than a month ago, if Israel resumed settlement building in full.
Speaking to the United Nations General Assembly on September 25, Abbas said he remained committed to reaching a peace deal with Israel within a year. But he said the direct negotiations with Israel could only succeed if the Jewish state ceased all settlement activities.
"Our demands for the cessation of settlement activities, the lifting of the siege, and an end to all other illegal Israeli policies and practices do not constitute arbitrary preconditions in the peace process," Abbas said.
"They are consistent with the implementation of obligations and previous commitments, and compliance with those has been repeatedly reaffirmed in all resolutions adopted since the very start of the political process," he continued.
"Israel's implementation of these obligations and commitments will lead to the creation of the necessary environment for the success of the negotiations and will give credibility to the pledge to implement the reached final agreement. Israel must choose between peace and the continuation of settlements."
Both sides today sought to play down tensions.
Abbas was quoted by the pan-Arab newspaper "Al-Hayat" as saying that the Palestinians would not immediately end peace talks with Israel if the settlement moratorium was not extended.
Israeli Defense Minister Ehud Barak, in turn, told the BBC that he saw a "50-50" chance of reaching a deal with the Palestinians on settlements.
Both leaders, however, face strong pressure at home not to cede ground on the issue.
The Islamist Hamas group, which rules the Gaza Strip, has slammed Abbas for negotiating with Israel, which the group does not recognize.
In Israel, pro-settlement parties in the governing coalition are pressuring Prime Minister Netanyahu to resume construction.
According to the Israeli settlement watchdog Peace Now, thousands of housing units are about to be built across the West Bank.
"According to our information, there are 13,000 housing units that have approval and can be built without a new approval of the government," said Yariv Oppenheimer, the director of Peace Now. "But we think that, in the next few weeks, we will see the construction of 2,500 housing units immediately."
More than 430,000 Jews live in over 100 settlements built across the West Bank and East Jerusalem on land that Israel captured from Jordan in a 1967 war.
The Palestinians oppose all Israeli construction on West Bank territories, an area they claim for a future Palestinian state.
compiled from agency reports