Israel's Benjamin Netanyahu on Tuesday directly urged Palestinian president Mahmoud Abbas to recognize Israel as a Jewish state and to "abandon the fantasy" of flooding Israel with refugees.

But his remarks sparked a furious reaction from the Palestinians who denounced his demand and said it had effectively put the final nail in the coffin of the U.S.-led peace talks.

An Israeli court sentenced firebrand Islamic preacher Sheikh Raed Salah Tuesday to eight months in prison for inciting Muslims to violence over Jerusalem's Al-Aqsa mosque.

Salah, leader of the radical northern wing of the Islamic Movement in Israel, was convicted in November of inciting "all Muslims and Arabs" in 2007 to "start an intifada (uprising) to support holy Jerusalem and the blessed Al-Aqsa mosque."

Palestinian President Mahmud Abbas will not extend peace talks with Israel beyond April without further prisoner releases and a halt to settlement construction, Israeli and Palestinian sources said Tuesday.

The U.S.-brokered talks, which began in July for a nine-month period that ends late April, have faltered in part because of Israel's continued construction of settlements in the occupied West Bank.

Egypt on Tuesday deported an American anti-war activist who was trying to travel to the Gaza Strip, airport officials and the activist herself said.

Medea Benjamin, who co-founded the CodePink anti-war group, was detained on arrival in Cairo airport on Monday. She had planned to join a delegation of activists on a visit to the Palestinian coastal enclave this week.

An Israeli air strike on the northern Gaza Strip killed two Palestinians and wounded two others on Monday, the emergency services in the Hamas-run enclave said.

Emergency services chief Ashraf al-Qudra told Agence France Presse that Musaad Alzaneen, a man in his early 20s, was killed in the raid on farmland near the town of Beit Hanoun.

Israel needs to make some tough decisions in order to find peace with the Palestinians, U.S. President Barack Obama warned Benjamin Netanyahu in talks at the White House on Monday.

But the Israeli prime minister insisted that the Jewish state had already done its part for peace, while the Palestinians had not.

Israel's prime minister pledged Sunday to resist "pressures" as he left for Washington on a visit expected to center on peace talks with the Palestinians and the Iranian nuclear dispute.

"I am now leaving on an important trip to the U.S. where I will meet with President Barack Obama," Prime Minister Benjamin Netanyahu's office quoted him as saying as he boarded his plane.

Jerusalem braced for a mass protest Sunday by ultra-Orthodox Jews enraged over plans to conscript their young men for Israeli military service.

Police said "hundreds of thousands" were likely to attend the demonstration alongside the main road in and out of the city and that there would be major disruption of traffic.

Israel's diplomatic missions and embassies across the world went on alert on Sunday following a raid by the Jewish state on a Hizbullah post in the border town of Janta.

Israel has reportedly raised security level at its embassies and diplomatic missions around the world fearing a possible retaliation by Hizbuulah, Israel's Yedioth Ahronoth daily reported.

Hizbullah deputy Secretary General Sheikh Naim Qassem stated on Saturday that “Lebanon is worthless without the resistance,” assuring that it will be mentioned in the ministerial policy statement.

"Lebanon owns its resistance for deterring Israel,” Qassem said at a Hizbullah event.