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Palestinian PM criticizes Clinton for letting Israel set peace agenda

This weekend, Clinton appeared to back off from US demands for an Israeli settlement freeze, raising the ire of Arabs. In Morocco today, she tried to mollify them.

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"It's as if we Palestinians are the only ones that have obligations that need to be observed, even though the road map included a total Israeli settlement freeze," said Fayyad.

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Arabs express 'deep disappointment' after Clinton remarks

In addition to presenting an impasse on Israeli-Palestinian talks, US backpedaling on the settlement issue could also stymie the Obama administration's efforts to reach out to Arab leaders and win their support for normalizing ties with Israel.

"I am telling you that all of us, including Saudi Arabia, including Egypt, are deeply disappointed ... with the results, with the fact that Israel can get away with anything without any firm stand... ," Arab League Secretary-General Amr Moussa told reporters at a gathering of Arab foreign ministers in Marrakesh, Morocco.

Clinton was in Morocco on Monday in a stop in part aimed at shoring up support for the Obama administration's work on the Israeli-Palestinian conflict.

She was scheduled to address the foreign ministers at the Forum of the Future in Marrakesh on Tuesday, and was also expected to meet with Moroccan Foreign Minister Taieb Fassi Fihri, the country's King Mohammed V, foreign ministers of several Persian Gulf states, and Saudi Foreign Minister Prince Saud al-Faisal. Saudi Arabia authored the 2002 Arab Peace Initiative, which suggests that if Israel gets to a peace deal with the Palestinians, it will throw open the doors to peace with the rest of the Arab world.

The Obama administration has tried to convince some of the Arab states to make moves toward normalizing relations with Israel as an incentive in the interim, but has met with little success.

Asked in Morocco about the negative Arab reaction to her comments on the settlement freeze issue, Clinton said her words were meant as "positive reinforcement" – something she believes in giving either side when they take steps toward peace. But she insisted that the US position remained firm.

"The Obama administration's position on settlements is clear and unequivocal. It has not changed," she said. "The US does not accept the legitimacy of continuing Israeli settlements."

• Material from AP and Reuters was used in this report.