Palestinian President Mahmoud Abbbas is likely to turn down Washington's request to withdraw a UN Security Council resolution demanding Israel halt settlement expansion on occupied land.
Several officials close to Abbas on Friday predicted this would be the consensus of a meeting of the Palestine Liberation Organisation's executive later in the day to discuss President Barack Obama's telephone call with Abbas on Thursday. The UN Security Council is scheduled to start discussions later on Friday on a draft resolution that Arab states submitted in January, demanding that Israel halt settlement activities in the West Bank and East Jerusalem.
The Palestinians say continued building flouts the internationally-backed peace plan that will permit them to create a viable, contiguous state on the land after a treaty with Israel to end its occupation and 62 years of conflict.
Israel says this is an excuse for avoiding peace talks and a precondition never demanded before during 17 years of negotiation, which has so far produced no agreement.
Obama, who has said that Israeli settlements in territories it captured in a 1967 war are illegal and unhelpful to the peace process, is opposed to a UN move that in Washington's view could shatter hopes of reviving the stalled talks.
In a 50-minute phone call, he asked Abbas to drop the resolution and settle for a non-binding statement condemning settlement expansion, Palestinian officials said. Abbas on Friday received a follow-up call from Secretary of State Hillary Clinton on the issue, the Palestinian news agency Wafa said.
"Caving in to American pressure and withdrawing the resolution will constitute Goldstone 2," said a Palestinian official, speaking on terms of anonymity.
He was referring to the wave of protest in October 2009 accusing Abbas of caving in to US pressure by agreeing not to submit for adoption a UN report that accused Israel and Hamas Islamists of war crimes during the brief Gaza war two years ago.
Abbas was hanged and burnt in effigy by pro-Hamas supporters furious over the move. Abbas maintains he insisted on submitting the report.
Fear of popular revolt
"It will be a political catastrophe if we withdraw this resolution," said a second Palestinian official.
"People would take to the streets and would topple the president," he said, noting the wave of protest in the Arab world that swept out the Egyptian and Tunisian presidents.
"It would have been easier for us if there were no revolts in the Arab world," another Palestinian official said.
The diplomatic manoeuvring is complicated by the effects of Middle East turmoil on the Arab League, whose members backed the draft resolution. Egypt, a dominant member, and Tunisia are preoccupied with the transition from deposed autocracies, and protests are flaring in Libya, Yemen and Bahrain.
Washington is trying to revive peace talks stalled since September over Israel's refusal to extend a moratorium on settlement building and Abbas's refusal to negotiate further until the Israelis agree.
Obama initially pressured Israel, its closest Middle East ally, to maintain the moratorium only to relent in the run-up to the 2010 US mid-term elections to avoid, some analysts said, alienating key voters, much to the Palestinians' frustration.
Obama told Abbas he would back a fact-finding visit by a delegation of the Security Council to the occupied territories.
"The Palestinian leadership will reject American demands even if our decision leads to a diplomatic crisis with the Americans. Now we have nothing to lose," said another official.
UN sources in New York say no one wants to see a US veto should a resolution unacceptable to Obama be put to a vote. But the Palestinian leadership feels backing off is not an option. One option, however, is to take no action on the draft.
Hundreds of Palestinian protesters rallied on Friday near Ramallah displaying banners demanding: "Veto settlements. Vote justice".