|Israel's prime minister said the deal had to serve Israel's "vital interests, with security being the priority," [EPA]
The United States is prepared to offer Israel written security guarantees if it would help to restart stalled Middle East peace talks.
"We continue our discussions with the Israelis. If there is a need to put certain understandings in writing, we will be prepared to do that," PJ Crowley, the US state department spokesman, said.
He declined to say what the details of the package may be.
The US has offered Israel an incentive package for a 90-day moratorium on settlement building in the occupied West Bank, but the proposed freeze would not include building in occupied East Jerusalem.
Binyamin Netanuahu, Israel's prime minister, has asked his cabinet to consider the package of security and diplomatic incentives.
In exchange for a 90-day moratorium on building in the West Bank, the US is reported to be offering Israel:
Vetoes on resolutions that do not favour Israel.
A promise that no more settlement freezes will be sought by the US.
20 F-35 stealth warplanes worth $3bn.
A comprehensive, signed security agreement with Israel.
Increasing pressure on Iran and Syria to curb their nuclear and proliferation activities.
But an Israeli official said on Friday the US had not yet provided the guarantees that Israel wanted, with Washington reluctant to commit to paper all the promises Netanyahu says he was offered verbally last week.
The latest snag concerned a pledge that Israel says Hillary Clinton, US secretary of state, made to provide the country with 20 stealth warplanes, free of charge.
Politicians said Washington was backtracking and now wanted some sort of payment for the coveted fighter aircraft.
"It looks like the free stealth fighters have slipped," Benny Begin, a minister from Netanyahu's Likud party who is opposed to the proposed US deal, said.
He said that Washington was setting a trap to extract major concessions later down the line.
"One may wonder if you cannot agree to understandings from one week to the next, what could happen over three months," Begin told Army Radio on Friday.
The Palestinians themselves have expressed outrage in private over reports of the US offer, saying it was a bribe to get Israel to fulfil basic international obligations.
Stopping short of rejecting the deal outright, Saeb Erekat, the chief Palestinian negotiator, expressed strong reservations about the proposal because the moratorium on new construction would only apply to the West Bank and not East Jerusalem, the Palestinians' hoped-for capital.
Erekat said that the US had not officially informed the Palestinians about the details of the proposal, but that "they know we have a major problem in not including east Jerusalem".
Mahmoud Abbas, the Palestinian president, will put the US plan before Palestinian decision-makers and call for an immediate session of Arab League officials before announcing an official decision, Erekat said.
Abbas told the the London-based Arab newspaper Asharq Al-Awsat that he refuses to link the troubled Middle East peace process with a US offer of additional military aid to its Israeli ally.
"We refuse to allow the offer of planes be linked in any way to a freeze on settlements," Abbas said in the interview, which was published on Friday.
"The United States is an ally of Israel and we can not prevent that," Abbas said.
"But let their aid be carried out far removed from the Palestinian peace negotiations and not be used as a pretext for giving more weaponry to Israel."
The potential construction freeze would cover future construction as well as projects that have started since September 26, when the previous 10-month moratorium expired.