Palestinian president Mahmoud Abbas is facing Western pressure not to allow his prime minister, Salam Fayyad, to resign at a time when the United States is trying to restart peace talks between Israel and the Palestinians.
The Reuters news agency reported on Thursday that Fayyad submitted his resignation, after weeks of conflict over his handling of the government and an economic crisis in the occupied West Bank. His letter of resignation was reportedly drafted last month.
Azzam al-Ahmed, a senior member of the ruling Fatah movement, said that Abbas and Fayyad would meet on Thursday, after the president returned from Qatar, to discuss Fayyad's possible resignation. But their discussion never happened, and it remains unclear when the two might meet.
"The meeting planned for Thursday evening has been postponed until further notice," a Palestinian source told the AFP news agency, without giving a reason.
'He's not doing it'
Fayyad, a former World Bank official, is popular in the West for his efforts to build government institutions in the West Bank.
Talk of his resignation was quickly dismissed by US and European diplomats. A senior official at the US State Department told reporters that he did not believe Fayyad was on the verge of resigning.
"He's not tendering his resignation to the best of my knowledge. He's not doing it," the official said on the sidelines of G8 talks in London, according to AFP. "As far as I know he's sticking around."
John Kerry, the US secretary of state, is trying to broker a new round of talks between Israel and the Palestinians, and diplomats said Fayyad's resignation would complicate that effort.
"Pressure is being put on Abbas to sit on this resignation offer for at least two months to see what comes of the US initiative," said a senior European diplomat, who declined to be named because of the sensitivity of the issue, according to Reuters.
Fayyad's reputation among Palestinians is more mixed; a growing number of people are angry about his stewardship of the stagnant economy.
The Palestinian Authority is in a serious financial crisis, partly because hundreds of millions of dollars in promised foreign aid have not materialised.
'Fayyad will have to decide'
Longstanding tensions between Fayyad and Abbas peaked on March 2 when the Palestinian finance minister, Nabil Qassis, announced that he was standing down. Abbas, who was abroad at the time, rejected the resignation but Fayyad agreed to it.
The crisis over the finance minister "was the reason for Fayyad's resignation," Ahmed said.
"Fayyad will have to decide today whether to keep Qassis in his post, or to resign as head of the government," he added.
Last week, the Fatah Revolutionary Council for the first time openly criticised Fayyad's government over its economic policy.
"The policies of the current Palestinian government are improvised and confused in many issues of finance and the economy," it said.
The criticism came as several high-ranking officials suggested Abbas might be about to dismiss Fayyad, who has also threatened to resign several times in the past.