Bending to US pressure in a speech a day earlier, Netanyahu backed down on decades of opposition to Palestinian statehood by endorsing an independent state next to Israel. He invited the Palestinians and the rest of the Arab world to resume peace talks.
Netanyahu's announcement came a week after Obama addressed world Muslims and strongly reiterated US backing for independent Israeli and Palestinian states living side by side in peace.
Obama, who has been pressing for peace talks to resume, made his brief comments at the end of an Oval Office meeting Monday with Italian Premier Silvio Berlusconi.
Even as Netanyahu endorsed the notion of two states, he refused to freeze Israeli settlements in the West Bank, as the United States is demanding. He also attached conditions that were immediately rejected by the Palestinians - including recognition of Israel as the Jewish state, which essentially would mean Palestinians refugees must give up their goal of returning to Israel or winning compensation for it. He insisted that a Palestinian state be demilitarized, and demanded that Jerusalem remain the capital of Israel.
