Jerusalem (CNN) -- The United States is committed to enticing Israeli and Palestinian leaders back into peace talks, a State Department spokesman said Tuesday, even though progress on a West Bank settlement freeze agreement stalled a day earlier.
"We're prepared to do everything we can to create the conditions for both the Palestinians, the Israelis to have confidence to return to direct negotiations," State Department spokesman P.J. Crowley said at a press briefing in Washington.
Crowley declined to offer specifics, saying he would not "give a play-by-play" of the U.S. discussions with the two parties.
On Monday, an Israeli government source said that Prime Minister Benjamin Netanyahu is insisting on a number of conditions for a settlement freeze and that only when those conditions are met will there be an agreement that the Cabinet would vote on.
The source did not say what those conditions were, but on Tuesday, the source said the problem was Palestinian objections to understandings reached in talks between Netanyahu and Secretary of State Hillary Clinton in New York. Netanyahu, the source said, wanted written guarantees the Israelis could continue building in Jerusalem, that the freeze will expire in 90 days and will not be extended and that the United States would not allow any initiative that would go beyond the negotiations.
When he receives the written guarantees, the source said, the prime minister will take the proposal to his Cabinet.
In Washington, Crowley told reporters that the United States "will continue to work with Israel to address what it sees as its legitimate interests in this process." He said the United States wants to get both parties back to the negotiations and still believes that an agreement can be reached within the 12-month period that Clinton outlined in August.
"We'll continue to engage with the Palestinians and address the Palestinians' interests in this process," he said. "We want to get them back in negotiations. We're trying to create the conditions to do that."
On Sunday, President Obama had called the prospects of a settlement freeze "promising" and a "very productive step." Secretary of State Clinton also praised the possible settlement freeze.
Netanyahu spoke to his Cabinet ministers Sunday morning, a day after he met with top officials to discuss the settlement-freeze proposal made by the United States, according to Israeli government sources.
The proposal could be a difficult sell for right-wing members of the coalition government.
Reaction was mixed among Israeli officials, several of whom were already responding negatively to the news.
Minister of Infrastructure Uzi Landau said before Sunday's meeting that he would not approve the proposal if the Cabinet voted on it.
"This is simply playing into the hands of all of the terror organizations here in the area, which will make it clear to them that terror pays off. ... Our future partners in the region learn that they simply don't have to make any concessions; they have to wait until more and more pressure will be applied on the Israeli side," said Landau, a member of the right-wing Yisrael Beiteinu party.
But Eli Yishai, leader of the right-wing religious Shas party, hinted that his party might support the proposal, noting that settlement construction could resume after 90 days in the West Bank and continue unimpeded in Jerusalem.
"Under these conditions, this can be examined," he said, adding that the party's spiritual leader would have the final say.
And Knesset member Yohanan Plesner said his Kadima party welcomed efforts to restart peace talks.
"It is about time that an understanding would be reached so that the peace negotiations could focus on substantive issues rather than on the debilitating dispute over settlements," he said.
In return for the temporary freeze, the U.S. government would oppose international efforts to impose a political solution on Israel in the peace process or to "delegitimize" the country, said the Israeli government source, who would not speak for attribution.
Mohammed Shtayeh, a member of the Fatah Central Committee, told CNN that the Palestinian negotiating team was "hoping for a much better deal," including a freeze on construction in "all Palestinian territories" throughout negotiations.
Shtayeh said he and other Palestinian negotiators were waiting for an official notification from Washington about the proposal. Leaders would later hold a meeting to discuss any offers on the table and release an official position, he said.
"The most important thing is that it is very unfortunate that such a deal is being conducted between Tel Aviv and Washington, without really any consultation with the Palestinians," he said.
Mustafa Barghouti, an independent Palestinian legislator, described the proposal as "nonsense."
"Why should Israel receive incentives for stopping violations of international law? And why is the freeze only for 90 days if everyone agrees that settlements are a violation of international law and are the main obstacle to peace?" he asked.
As part of the proposed deal, the Israeli government sources said, Obama would ask Congress to approve the sale of 20 advanced fighter planes to Israel.
Silvan Shalom, a Cabinet minister from Netanyahu's Likud party, said he was opposed to the continuation of the building freeze, noting that such an agreement with the United States would be a "strategic mistake."
"The U.S. is a friend of Israel, and U.S. support has never been conditional before," he said.
Knesset member Uri Orbach, head of the Jewish Home right-wing national religious party, said he would push for his party to quit the coalition government if a settlement moratorium is renewed.
"We will not be partners to Netanyahu and the Likud [party]'s freezing obsession," Orbach said.
The main umbrella group of Jewish settlers in the West Bank also sharply criticized the proposal Sunday.
"This proposed deal, if accepted, represents a fundamental collapse of our government's integrity and national resilience. The Israeli leadership should never allow its citizens to become pawns to the whims of the international community," a statement from the Yesha Council of Communities in Judea and Samaria said. "We are our own sovereign community whose very security and future should not be dictated by President Obama or Secretary Clinton."
Hagit Ofran, settlement watch project director at Peace Now, said her organization would continue to fight settlement construction.
"In order to achieve peace, Israel must halt all the construction," she said, including new units built since an earlier freeze ended September 26.
The reported American proposal does not include any limit on Israeli construction in East Jerusalem, which has also been a source of major conflict between Palestinians and Israelis
A senior U.S. administration official said Friday that while talks between Clinton and Netanyahu on Thursday were substantive, there were no breakthroughs.
Another U.S. official said that the prime minister isn't budging on settlements in a way that will satisfy Palestinians, who broke off the peace talks when Israeli resumed settlement construction in late September.
CNN's Shira Medding, Kareem Khadder, Kevin Flower and Elise Labott contributed to this report.