The United States may have cleared a hurdle in its quest to revive the peace process when the Palestinians agreed to indirect talks with Israel, but observers doubt they will lead anywhere.
The Palestinians' decision on Sunday to give US-brokered talks a chance for four months was followed by an Israeli announcement of plans to expand a West Bank settlement despite the impending arrival of US Vice President Joe Biden.
The sequence of events further darkened the cloud of scepticism hanging over efforts to launch yet another round of peace talks to try to resolve the decades-old conflict.
For the Palestinians, Israel's unwillingness to freeze settlement construction, and the Obama administration's apparent inability to force it to do so, makes it hard to imagine that Israel would ever make the far more painful concessions envisioned in a final peace deal.
"The basic test for Israel's intentions was when it refused to halt settlement activity," says Ziad Abu Amr, the head of the Palestinian Council on Foreign Relations.
"As long as they continue to build settlements in Jerusalem, they have no credibility," he adds, referring to Arab east Jerusalem, seized and annexed by Israel in 1967 in a move not recognised internationally.
The United States initially backed the Palestinians' insistence on a complete freeze but appeared to back off late last year when Israeli Prime Minister Benjamin Netanyahu ordered a partial ban on new construction.
The Palestinians condemned the 10-month moratorium announced in November as insufficient because it left out east Jerusalem as well as public buildings and existing projects, but Washington praised the move as "unprecedented" and urged both sides to immediately return to the negotiating table.
"When there was a need for American intervention to force Israel to halt settlements, the administration retreated," Abu Amr says.
"Because of that, there are doubts and worries that the US administration cannot provide the necessary conditions for negotiations to succeed."
Netanyahu has blamed the Palestinians for stalling peace efforts by refusing direct talks, but many doubt that his right-wing government can meet them half-way on core issues like final borders and Jerusalem.
"It's very hard to say how strong (Netanyahu's) commitment is, if at all, to a genuine two-state solution," says Yossi Alpher, who served as an Israeli advisor during the Camp David peace talks in 2000.
"But he certainly has made it clear that he is not willing to compromise on Jerusalem and, without that, there is no chance for a two-state solution."
But Israelis also point out that Palestinian president Mahmud Abbas rejected what they viewed as generous offers by Netanyahu's more dovish predecessors Ehud Olmert and Ehud Barak.
"The blame is not only with Netanyahu, it's with Abbas as well," Alpher says. "There's no chance that Netanyahu will offer him even what Olmert offered."
Some analysts have argued that the Obama administration's approach has been flawed from the beginning and that it should instead focus on launching Israeli-Syrian talks which could bring greater regional dividends.
"I think the administration is making a mistake on pinning so much on yet another attempt to bring Israelis and Palestinians to an agreement," Alpher says.
"I don't think that's possible given the basic positions of Netanyahu and Abbas and the political constraints they are operating under."
The Palestinians have said they will try the indirect negotiations for four months and focus on setting final borders. Failing that, they have threatened to go to the UN Security Council to seek a resolution to end the occupation.
Meanwhile, Palestinian prime minister Salam Fayyad has vowed to build the institutions of an independent state by 2011 regardless of any negotiations.
"It's a race against time. The Israelis basically have the choice of either agreeing to a Palestinian state in negotiations or being confronted by a Palestinian state," says Palestinian analyst Daoud Kuttab.
"If the Israelis want it done in an amicable and bilateral way, they have an opportunity. If they fail to respond to the international consensus, a state will exist but it will not be one that was negotiated."