Israel has been offered US security guarantees and a $3bn defence deal in return for a settlement-growth pause AFP]
Binyamin Netanyahu, the Israeli prime minister, has reportedly met stiff opposition within his cabinet to a US proposal for freezing settlement construction in the West Bank for 90 days.
Netanyahu's cabinet has been mulling the proposal for two weeks, and the stakes for a future peace deal with the Palestinians might be high.
Mahmoud Abbas, the Palestinian president, on Sunday said he will not return to peace talks with Israel unless there is a freeze on settlement building that includes East Jerusalem.
Abbas, in Cairo for talks with Hosni Mubarak, the Egyptian president, said the Palestinians and Israel had received no official US request to resume talks which stalled weeks after it was launched in September, when an Israeli settlement freeze expired.
"If there is no complete halt to settlements in all of the Palestinian territories including Jerusalem, we will not accept."
Protesters, most of them schoolchildren given the day off and brought in buses from West Bank settlements, gathered in front of Netanyahu's office building on Sunday to voice their opposition to such a freeze, Al Jazeera's Sherine Tadros reported from Jerusalem.
She said the students were given whistles, and many said they did not know why they were there.
The US proposed a deal to Netanyahu when he met Hillary Clinton, the US secretary of state, in New York City on November 11.
Speaking to Al Jazeera, Sabri Saidam, deputy speaker of the Fatah Revolutionary Council dismissed the protests as "an orchestration of demonstrations" by Israel's right wing, and talk of a potential construction freeze in the West Bank as an "orchestration of media hype .. to convince the international community that Netanyahu is a man of peace, but yet, he's facing resistance."
"I think This is not the time for shows of such nature," said Saidam.
"It is time for pressure to be exerted on Israel to abide by the will of the international community."
On Friday, PJ Crowley, the state department spokesman, confirmed for the first time that the US would be willing to provide Israel written guarantees describing the incentives it would offer Netanyahu in exchange for a freeze.
Direct peace talks between Netanyahu and the PA resumed on September 2 in Washington DC but derailed again when a 10-month settlement moratorium - already violated multiple times by Israel - expired.
In exchange for the new 90-day proposed freeze, the US has made several offers, reportedly including the steeply discounted sale to Israel of 20 F-35 stealth aircraft, worth an estimated $3bn.
Cabinet ministers from the far-right Shas party who had previously been expected to abstain from a vote on the freeze, are now said to be weighing a "no" vote, the New York Times newspaper reported on Friday.Such a move would probably scuttle any deal.
A sticking point for Shas and others is East Jerusalem, considered a legal Israeli neighbourhood by Netanyahu's government and an illegal settlement by Palestinians who hope to make it the capital of their hoped-for future state.
The US reportedly will not accept new construction in East Jerusalem, though its condemnation of such construction has been lukewarm.
When Israel said earlier in November that it would proceed with plans to build around 1,300 homes in the area, Obama said that such a decision is "never helpful when it comes to peace negotiations".