The United States said Tuesday it was in negotiations to break the impasse in Middle East peace talks, amid reports that Israel was ready to work with proposals by President Barack Obama.

Obama angered right-leaning Prime Minister Benjamin Netanyahu in May when the US leader called in a speech for a Palestinian state based on the borders that were in place before the 1967 Six-Day War with land swaps.

But Israeli public radio said late Monday that Netanyahu had decided to negotiate in line with Obama's proposal, with conditions.

State Department spokesman Mark Toner declined comment on Netanyahu's stance, saying it was up to Israel to announce its own position, but said that the United States was in talks with both sides.

"Our focus remains on how to overcome the current impasse between the parties," Toner told reporters.

Upset with the deadlock, the Palestinian Authority has been expected to launch an initiative at the UN General Assembly next month to win international recognition for a Palestinian state.

"We're working hard with both parties to find a way back to the negotiating table before then," Toner said.

Israeli Defense Minister Ehud Barak said on Friday in New York that the Israeli government was looking to find "a formula" which would allow for the resumption of negotiations.

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