This week's Palestinian reconciliation deal faces a swift reality check, with President Mahmoud Abbas the focus of both Israeli fury and U.S. concern and Hamas seeking to salvage relations with Egypt.

"Hamas and the Palestinian Authority (PA) had no option but to reconcile," Naji Sharab, a political science professor at Gaza's al-Azhar University, told Agence France Presse.

Israel said on Thursday it was halting negotiations with the Palestinians following their unity deal with the Hamas rulers of Gaza, as faltering U.S.-backed peace talks approached their deadline.

Prime Minister Benjamin Netanyahu slammed the agreement between the rival factions as a move that "kills peace," but senior Palestinian official Saeb Erakat blamed the demise of the process on Israeli settlement activity.

Israel's security cabinet was to meet on Thursday morning to weigh its response to a unity deal struck between the Palestinian leadership and the Hamas rulers of Gaza.

Prime Minister Benjamin Netanyahu reacted angrily to Wednesday's agreement between the rival factions accusing Palestinian president Mahmoud Abbas of choosing "Hamas, not peace".

Mediation led by the United States to resolve a dispute between Lebanon and Israel over their Exclusive Economic Zones (EEZ) has reached a deadlock after a top U.S. official described it as “excellent” earlier this month.

U.S. Department of State Deputy Assistant Secretary for Energy Diplomacy Amos Hochstein, who is mediating the talks between the two countries, confirmed that the dispute on oil block 9.

Rival Palestinian leaders from the West Bank and Gaza Strip forged a new reconciliation agreement on Wednesday, angering Israel at a time when peace talks are at a standstill.

Israeli Prime Minister Benjamin Netanyahu slammed Palestinian President Mahmoud Abbas for choosing "Hamas, not peace", and a Netanyahu aide said he had called off a peace meeting with the Palestinians scheduled for Wednesday evening.

Rival Palestinian leaders from the West Bank and Gaza Strip agreed Wednesday to form a unity government within five weeks as peace talks with Israel face collapse.

It is not the first time that the rival sides have announced a deal to end seven years of separate Palestinians administrations in the West Bank and Gaza.

Israel is to start sending call-up papers to all Christian Arabs of military service age, army radio reported Tuesday, angering Arab lawmakers who accused the government of seeking to divide Christians from Muslims.

Military service will remain voluntary for Israel's 130,000 Christian Arabs as it is for its more than 1.3 million Muslim Arabs.

The Palestinians have relaunched efforts to reconcile their rival leaderships in the West Bank and Gaza Strip as U.S.-brokered peace talks with Israel teeter on the edge of collapse.

A week before a nine-month target originally set for an Israeli-Palestinian deal, a Palestine Liberation Organization (PLO) delegation was expected in Gaza City on Tuesday to try to revive long-stagnant unity efforts.

The Palestinians on Tuesday played down a threat to dismantle the Western-backed Palestinian Authority, which is Israel's interlocutor, if U.S.-sponsored peace talks remain deadlocked.

"No Palestinian is speaking of an initiative to dismantle the Palestinian Authority (PA)," chief negotiator Saeb Erakat told Agence France Presse.

The U.S. Supreme Court Monday decided to hear the case of an American born in Jerusalem, once again taking up the sensitive issue of the status of the contested city.

The justices will hear arguments in the case in the fall before deciding on the constitutionality of a 2002 law that directs the State Department to give Israel as the country of birth in passports of Americans born in Jerusalem.