The Israeli and Turkish embassies in both nations will reopen, according to a report in the Turkish newspaper Today's Zaman on Thursday.
The report followed a meeting between Prime Minister Binyamin Netanyahu's personal representative on energy and security issues, David Meidan, and Turkey's National Intelligence Organization (MİT) chief, Hakan Fidan, in Ankara earlier this week, during which the move to normalize relations was allegedly discussed.
A possible visit by Prime Minister Recep Tayyip Erdogan to Israel was also allegedly discussed.
The Prime Minister's Office denied Thursday's reports of normalization.
Turkish media attention on Israeli-Turkish relations was heightened in the run-up to critical municipal elections, to take place this coming Sunday. However, Jerusalem assessed that a win by Erdogan's AK party in the key city of Istanbul would strengthen his position and lead him to toughen his position toward Israel.
Erdogan and Netanyahu agreed to normalize relations after a three-year deadlock in March 2013, after Netanyahu – at the behest of US President Barack Obama – called Erdogan and apologized for operational errors that may have led to the loss of life on the ship. The expected normalization, however, never materialized.
Diplomats from the two countries met at least four times over the past year working on an agreement that would enable a restoration of full ties. Turkey withdrew its ambassador immediately after the incident, and expelled Israel’s envoy in 2011.