Prime Minister Benjamin Netanyahu and Palestinian Authority President Mahmoud Abbas could hold direct peace talks for the first time in seven years, Channel 20 said on Thursday night in a report on a three-way Washington meeting with US President Donald Trump scheduled next month.The report comes just two months after Trump began to formally work to bring Israelis and Palestinian back to the negotiating table.The last round of US-led talks broke down in April 2014 and did not involve a Netanyahu-Abbas meeting.Since 2010, the Palestinians have refused to hold direct talks unless Israel freezes West Bank settlement activity and Jewish building in east Jerusalem. Israel has refused to cede to that demand insisting that talks should be held without preconditions.Bloomberg News on Thursday reported that the Palestinians have temporarily dropped that demand, quoting Abbas’s senior economic adviser and former deputy prime minister Muhammad Mustafa.“We have not made the settlements an up-front issue this time. We think it’s better for all of us right now to focus on giving this new administration a chance to deliver,” Mustafa told Bloomberg.The Prime Minister’s Office said it did not know anything about the Channel 20 report regarding the meeting. The reporter “did not check with us first,” a spokesman in the Prime Minister’s Office said. Defense Minister Avigdor Liberman told Channel 2 that Israel was closer to a peace deal with the Palestinians than at any other time in its history.“We are closer than ever before to an agreement. I hope that we will take advantage of this opportunity,” he told Channel 2 on Thursday night.The possibility for a new agreement is due both to Trump and to a new clarification by Arab states that their problem is not Israel, Liberman said, adding that the moderate Arab nations now believe Israel could help them solve their problems.“If someone comes and puts a deal on the table that includes an agreement with all the moderate Arab nations, including the opening of embassies, trade relations and direct flights, it would get a majority in the Knesset,” Liberman said.Since taking office in January, Trump has separately hosted Netanyahu and Abbas in the White House. Last month he visited the region, meeting with Netanyahu in Jerusalem and Abbas in Bethlehem. His special envoy Jason Greenblatt has also held meetings with Israelis and Palestinians in Washington, Israel and the Palestinian territories.US Ambassador to the UN Nikki Haley is visiting Israel and the Palestinian territories this week and has also spoken with Israeli and Palestinian leaders. On Wednesday she met with Netanyahu, and she is scheduled to talk with Liberman on Friday.Intelligence Minister Yisrael Katz on Friday morning dismissed Liberman’s remarks during an interview with Army Radio, “I know everything he knows, and I don’t see a basis for this statement. I personally have not concluded that the other side [the PA] can and wants to reach an agreement,” Katz said.Herb Keinon contributed to this report.