The United States expressed surprise and concern Tuesday over a report that Israel is planning to build 20,000 new settler homes in the occupied West Bank.

"We are deeply concerned by this latest report," said State Department spokeswoman Jennifer Psaki. "We were surprised by this announcement and are currently seeking further explanation from the government of Israel."

Psaki emphasized that Washington had not been briefed in advance by Israel about the settlement project.

She repeated the long-standing US diplomatic position on settlements -- a position reaffirmed last week during Secretary of State John Kerry's visit to the Mideast -- that "we do not accept the legitimacy of continued settlement activity."

Psaki said the United States has "called on both sides to take steps to create a positive atmosphere for the negotiations," which, with Kerry's mediation, re-launched in July.

The plans by the Israeli housing minister for a "record" 20,000 new settler homes, revealed by an Israeli watchdog, threaten the already faltering peace talks.

During his visit to the Mideast last week, Kerry rejected statements from Israeli leaders that the settlement announcements were in keeping with tacit "understandings" between the two sides linked to the release of 52 veteran Palestinian prisoners since August.

Israel must avoid spats with US, Lieberman says on return
Jerusalem (AFP) Nov 12, 2013 - Israel's Foreign Minister Avigdor Lieberman, newly reappointed after being cleared of corruption, on Tuesday urged his government to avoid spats with the US over its policy on Iran's nuclear drive.

Israel and the United States have been locked in a war of words over negotiations between world powers and Iran that could see sanctions relaxed in exchange for Tehran curbing or freezing parts of the disputed atomic programme.

"Regarding our recent differences with the United States, it's now time to calm things down," Lieberman said at a ceremony marking his return to the foreign ministry after an absence of more than a year.

He said he had met US ambassador Dan Shapiro in his "first work meeting" on Tuesday morning, and stressed that "relations with the US are crucial, and without them we cannot manoeuvre on the world stage."

"Our relations are good and stable, and nothing can change that," he said. "It's only natural that we'll sometimes have differences of opinion with the US... but these differences need not be expressed publicly."

Shapiro on Monday sought to quell Israeli fears over an emerging deal with Iran, vowing that Washington would never let Tehran acquire a nuclear weapon.

President Barack Obama "will not permit Iran to acquire a nuclear weapon, period," he told delegates attending the General Assembly of the Jewish Federations of North America in Jerusalem.

Western countries accuse Iran of seeking to develop an atomic weapon, a charge Tehran denies.

Diplomats have said they are closing in on an interim agreement that would freeze or curb some of Iran's nuclear activities for as long as six months in exchange for an easing of the tight sanctions on the Islamic republic, after failing to secure a deal at weekend crunch talks in Geneva.

Israel's Prime Minister Benjamin Netanyahu has furiously denounced the emerging agreement as "dangerous", reaching out to world leaders and to the American public to get his point across.

Officials in Israel have warned they could carry out unilateral military action to stop Iran developing nuclear weapons capability.

Lieberman took the oath of office in Israel's parliament on Monday, and was welcomed back by Netanyahu, who had been holding the foreign affairs portfolio himself during his absence.

The rightwing leader quit in December 2012 after being charged with fraud and breach of trust for appointing diplomat Zeev Ben Aryeh as ambassador to Latvia after he warned Lieberman about a police probe into his affairs.

A Jerusalem court on Wednesday agreed Lieberman had engaged in "inappropriate conduct".

But it did not find it warranted a criminal conviction and announced his acquittal in a hearing that lasted just a few minutes.