Britain is considering recalling its ambassador to Israel to protest at Prime Minister Binyamin Netanyahu's decision to expand settlement building, a diplomatic source said on Monday. The source, who declined to be named, said London would decide whether to recall its ambassador later in the day.

Friday’s announcement of the additional units and the planning work to be done on E1 was the government’s immediate reaction to the Palestinians’ successful move to upgrade their status at the UN General Assembly to that of non-member observer state.

US President Barack Obama's former chief of staff Rahm Emanuel reportedly slammed the decision, saying Netanyahu's behavior was "unfathomable," Channel 2 reported Sunday night.

Emanuel spoke in a closed-door meeting during the Saban Forum in Washington, DC, where sources quoted him as saying Obama would no longer accept disrespect from Netanyahu.

"It is unfathomable that a prime minister would behave the way Netanyahu behaved," he said, adding that "Netanyahu backed the wrong candidate in the US elections and lost."

Britain's Minister for the Middle East Alistair Burt summoned Daniel Taub, Israel's ambassador in London, for talks on the issue. "The Minister set out the depth of the UK's concerns," a British Foreign Office spokesman said.

The French government on Monday played down reports that it was also considering recalling its ambassador. "There are other ways in which we can express our disapproval," a foreign ministry official told Reuters.

Both the British and French embassies declined to comment on the reports, but the British embassy issued a statement saying they had made clear they would not support strong Israeli retaliation to a UN vote last week that gave the Palestinians de facto recognition of statehood.

"The recent Israeli government decision to build 3,000 new housing units threatens the two-state solution and makes progress through negotiations harder to achieve," the British embassy in Tel Aviv said. "We have called on the Israeli government to reconsider."

Vice Premier Moshe Ya'alon told Army Radio he was not aware of any recall. "I did not hear of this, either via the foreign ministry or the prime minister's office. Therefore I have a hard time believing it is true," he said.

Russia urged to reconsider the plans, saying building new homes would undermine any chance for direct peace talks.

Russia "views these Israeli intentions with the most serious concern", the Foreign Ministry said in a statement. "Implementation of the announced plans for large-scale settlement activity would have a very negative effect on efforts to resume direct negotiations aimed at a two-state solution of the Palestinian-Israeli conflict," it said.

Israeli Left raises concern about isolation

Labor MK Binyamin Ben-Eliezer warned that the world was "losing its patience to Prime Minister Binyamin Netanyahu's irresponsible policies."

Ben-Eliezer called the move "a badly timed decision" that "risks the loss of support from the United States and from European countries."

"The world is telling Israel 'enough,' and the fact that friend-states like Britain and France are considering recalling their ambassadors is a long-reaching issue that can lead Israel to international isolation," Ben-Eliezer said.

Tzipi Livni, heading an new party, said Netanyahu's decision to build in the settlements "isolates Israel, encourages international pressure and will not happen either way."

Livni added that reports that France and Britain are considering to recall their envoys proves that Netanyahu's government makes diplomatic moves that are bad for Israel.

"In one month of dangerous military and diplomatic moves, Netanyahu formed a Hamas state in Gaza, a Palestinian state in the UN and now, with his response, made Israel guilty in the eyes of the world," Linvi said.

Herb Keinon contributed to this report.

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