Turkish Prime Minister Recep Tayyip Erdogan’s threat to unleash “Plan B,” a further deterioration of ties with Israel if Jerusalem does not meet his terms to settle the Mavi Marmara issue, left a Jerusalem official cold and unmoved on Monday.

“The problem is that many people here don’t think that this is Plan B, but rather Plan A, and that Erdogan’s long-term strategic plan has been to reduce to a minimum the ties with Israel,” the official said.

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According to this official, there is a great deal of skepticism in Jerusalem that Israel could do anything to satisfy Erdogan.

Meanwhile, Deputy Foreign Minister Danny Ayalon spoke by phone with his Armenian counterpart, Arman Kirakosian, on Monday, and noted the historical and cultural connections between the two countries, and thanked him for the friendly ties between Armenia and Israel.

Ayalon emphasized Israel and the Jewish people’s sensitivity to the “Armenian tragedy,” a reference to the Armenian genocide at the hands of the Turks. The deputy foreign minister also stressed the importance Israel attributed to a continuation of developing ties and cooperation with Armenia.

Ever since the Mavi Marmara incident in May 2010, Israel’s ties with historic Turkish foes, such as Greece, Cyprus, Malta, Bulgaria and Romania have improved dramatically.

According to the website of the Turkish daily Hurrieyt, Erdogan acknowledged a “Plan B” to further freeze ties with Israel if Turkey’s conditions for resolving the incident – including an Israeli apology, payment of compensation to the families of the nine victims and a lifting of the Gaza blockade – were not met by July 27, the day when the UN’s Palmer Commission was to have issued its report.

“We are going to wait for their [Israel’s] decision for a period of time. Then [if no apology comes], we will surely implement our Plan B,” Hurrieyt reported the Turkish prime minister as telling reporters Saturday at a joint press conference with Jordanian Prime Minister Marouf Bakhit.

Since then, however, UN Secretary-General Ban Ki-moon asked for a month-long postponement of the release of the Palmer report to allow the sides more time to come up with a formula to resolve the crisis, Israeli officials said.

According to Hurrieyt, Erdogan’s “Plan B” included reducing Turkey’s level of representation in Tel Aviv, lowering the level from charge d’affaires to second secretary.

Turkey recalled its ambassador to Israel immediately after the Mavi Marmara incident.

Last week the Turkish press reported Erdogan would visit Gaza if an apology was not forthcoming from Israel, a threat dismissed as hollow in Jerusalem by officials who said Erdogan could enter Gaza via Egypt, but that a photo opportunity there with Hamas leadership would probably undermine the Palestinian Authority more than it would bother Israel.

Israeli officials said the continual reports of a “Plan B” from Erdogan seemed a transparent attempt to impact the debate in Israel about whether or not to fulfill Ankara’s demands.

The officials said wording has been worked out between representatives of both sides for a limited Israeli apology for “operational mishaps” that took place when Israel intercepted the vessel, and that Israel has agreed to pay compensation through a foundation that will be set up for this purpose.

Israel wants to make sure, however, that if this is done, there will be no additional Turkish legal claims against Israel or the soldiers who participated in the operation.

The US, according to Israeli officials is pressing both Israel and Turkey to reach an accommodation on the matter, keen on seeing a resurrection of an Israel- Turkey-US triangle, which Washington believes is important for regional stability.

The US is also pressuring Turkey on another matter: moving ahead with reconciliation with Armenia despite Azerbaijan and Armenia’s failure to negotiate the disputed Nagorno-Karabakh issue in the South Caucasus. In May, Erdogan said Ankara’s relations with Armenia could not “get back on track” without any breakthrough on the Nagorno-Karabakh issue. Erdogan is scheduled to go to Azerbaijan on Wednesday.

Ayalon, in his conversation Monday with his Armenian counterpart, said Israel supported efforts “to reach an agreed solution” to the issue.

Nagorno-Karabakh, which Azerbaijan and Armenia fought over from 1991- 1994, has been a source of great tension between the two countries ever since. The territory, an enclave with a majority of Armenians inside Azerbaijan, has been under Armenian control since claiming independence from Azerbaijan in 1991.

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