"Time is of the essence," Abbas said.

Marwan Bishara, Al Jazeera's senior political analyst, said it was "shocking" to see a Palestinian leader at the White House in agreement with the US president on the key issues of a two-state solution and on settlements.

Palestinians must also halt anti-Israel violence and what he called incitement, Obama said.

Settlement pressure

Abbas also held separate talks with Hillary Clinton, the US secretary of state.

Abbas and Clinton held talks in
Washington on Thursday [AFP]
The meeting came shortly after the US issued one of its strongest calls yet to Israel to halt the building of settlements on Palestinian land.

In remarks on Wednesday Clinton said that Obama "was very clear" when Binyamin Netanyahu, Israel's prime minister, visited the White House last week that "he wants to see a stop to settlements. Not some settlements, not outposts, not natural growth exceptions".

But an Israeli government spokesman quickly rejected Clinton's remarks, saying settlement activity would continue as usual.

"Normal life" will be allowed in settlements in the occupied West Bank, Mark Regev said, effectively meaning construction would continue to accommodate population growth.  

The Palestinians say settlements built on land Israel occupied in the 1967 Middle East war and deemed illegal internationally, could deny them a viable and contiguous state and that expansion activities undermine efforts to negotiate a peace agreement.

About 500,000 Israeli setters live in more than 100 settlements that Israel has built since its 1967 occupation of the West Bank and East Jerusalem, territory in which almost three million Palestinians live.