Palestinian preconditions for peace talks make a return to negotiations impossible for Israel, Prime Minister Benjamin Netanyahu said on Monday.
"To me the setting of preconditions is an insurmountable obstacle," Netanyahu told the foreign affairs and defence committee, a parliamentary statement said.
The Palestinians say they will only return to negotiations if Israel stops building on land they want for their future state and if the Jewish state agrees to negotiate on the basis of the borders that existed before the 1967 Middle East war.
Israel demands talks "without preconditions" and refuses publicly to freeze settlement building.
US Secretary of State John Kerry has postponed an expected trip to Israel and Palestinian territories to attend White House talks on Syria, US officials told AFP on Monday.
The visit had not been formally announced but a tentative schedule from the office of Israeli President Shimon Peres had said the two men would meet on June 11.
Israel HaYom, a newspaper considered close to Netanyahu also said Kerry had been due to arrive on Tuesday.
It said he delayed to give Palestinian president Mahmud Abbas more time to decide whether to drop his insistence on a settlement freeze.
Last week, Kerry warned that if his efforts to kickstart the peace negotiations, frozen since 2010, fail now, there may never be another chance.
Israeli news website Ynet quoted Netanyahu as telling a meeting of senior members of his rightwing Likud party on Tuesday that he had received no US request for a settlement freeze.
He told the parliamentary committee that Israel was building in the West Bank and would continue to do so.
He said that keeping hold of the major settlement blocs that house most of the 360,000 Israelis living in the occupied West Bank outside annexed Arab east Jerusalem would not prejudice the outcome of peace talks.
He has said before that he intends to keep those areas under Israeli rule, leaving open the option of withdrawing from small, isolated settlements.
"We need to be smart not just right," he told MPs. "Settlement in the blocs will not significantly affect the ability to reach an agreement."
But he also told the parliamentary committee that the alternative to statehood for the Palestinians would be for them and Israelis to share one country, and that was not an option.
"If we go into direct negotiations, it is likely to be very hard but the alternative of a binational state is one we do not want," he said.
Speaking at the weekly cabinet meeting on Sunday, Netanyahu -- who in 2009 declared his support for a two-state solution -- said he and Kerry will "try to make progress to find the opening for negotiations with the Palestinians, with the goal of reaching an agreement".
"This agreement will be based on a demilitarised Palestinian state that recognises the Jewish state, and on firm security arrangements based on the IDF (Israeli military)," he said.
Abbas aide Nabil Abu Rudeina said that those Israeli terms were themselves preconditions.
And Palestinian negotiator Saeb Erakat said that Netanyahu was trying to paint Abbas into a diplomatic corner.
"It is very clear that the comments of Netanyahu and his government show that he is preparing to place the blame on president Mahmud Abbas," he told AFP.
"This is the start of trying to shift responsibility for the non-resumption of negotiations to the president and the Palestinian leadership."