BETHLEHEM - US Secretary of State John Kerry, faced with grim Israeli and Palestinian assessments of progress in peace talks, said on Wednesday that Washington was not giving up on a deal.

"As in any negotiation there will be moments of up and moments of down, and it goes back and forth," Kerry said in Bethlehem, in the West Bank, where he met Palestinian President Mahmoud Abbas.

"But I can tell you that President Obama and I are determined, and neither of us will stop in our efforts to pursue the possibility (of peace)," he said.

Responding to Palestinian frustration over Israeli settlement construction in the West Bank, Kerry said the US considers the settlements "illegitimate" and stressed that "at no time" did the Palestinians agree to accept the settlements as a part of a negotiated peace accord.

Earlier at a meeting with Kerry in nearby Jerusalem, Prime Minister Binyamin Netanyahu said the negotiations on a two-state solution to the Israeli-Palestinian conflict had failed to make any real progress.

The bleak picture painted by the right-wing leader was similar to the one sketched by senior Palestinians, who have said an Israeli plan announced last week for 3,500 more settler homes in the occupied West Bank was a major obstacle to the success of the negotiations.

But in Bethlehem, Kerry said the United States, Israel's closest ally, was convinced "that despite the difficulties, both leaders, President Abbas and Prime Minister Netanyahu, are also determined to work towards this goal".

Kerry, whose shuttle diplomacy helped to revive the land-for-peace talks last July after a three-year break, has set a nine-month target window for an agreement, despite widespread skepticism among Israelis and Palestinians.

Few details have emerged from the negotiations, held at unannounced times and at secret locations in line with pledges to keep a lid on leaks.

But Palestinian officials have been airing their frustration over a lack of movement on core issues such as the borders of a Palestinian state, security arrangements, the future of Israeli settlements and the fate of Palestinian refugees.

Abbas, in a speech broadcast on Monday, said that after all the rounds of negotiations "there is nothing on the ground".

JPost.com staff contributed to this report.

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