The United States pledged to keep working to move the peace process forward after Arab League ministers gave Washington a month to save direct Middle East peace talks.
The ministers, meeting in Sirte, Libya, made it clear in a statement issued Friday that the Israeli-Palestinian talks would collapse if Israel did not halt its settlement building in the occupied West Bank.
The Arab League Follow-up Committee said in a statement it would meet "in a month to review the alternatives proposed by (Palestinian president Mahmud) Abbas to determine the necessary steps to be taken on this."
The committee on the Middle East peace process, which groups 13 Arab foreign ministers, also urged Washington to pursue efforts in the interim to stop Israeli settlement activity.
It added that it "supports the position of the Palestinian president calling for a total cessation of (Israeli) settlement to allow the resumption of direct negotiations."
Abbas spokesman Nabil Abu Rudeina said the statement "offers huge support for the position of president Abbas.
"The committee will convene again in a month to study the alternatives, which gives the US administration a chance between now and then to try to find a solution to the settlements issue," Abu Rudeina said.
Washington appreciated the Arab League's statement of support for its efforts, US State Department spokesman Philip J. Crowley said in a written statement.
"We will continue to work with the parties, and all our international partners, to advance negotiations toward a two-state solution and encourage the parties to take constructive actions toward that end," Crowley added.
An official who attended the Arab League ministers meeting told AFP on condition of anonymity that among the alternatives proposed by Abbas if the talks fail was asking the UN Security Council and Washington to recognise a Palestinian state on 1967 pre-war borders.
Another was a recourse to the UN General Assembly to demand that the occupied territories be placed under international mandate.
Abbas came to Sirte to seek Arab backing to withdraw from the peace negotiations after Israel adamantly refused to extend a freeze on settlement building that expired on September 26.
Last-ditch efforts to reach a compromise appeared to have failed, with Israel silent on the moratorium and the Palestinians insisting they would not talk while settlement activity continued on land they want as a future state.
The ministers' statement came after Arab League chief Amr Mussa gave a dire assessment of the outlook for the peace talks, which resumed on September 2 after a 20-month hiatus.
"The situation is negative and is not favorable to direct negotiations," Mussa said, adding there were many alternative measures the Arabs could take including "going to the (UN) Security Council."
With the peace talks on tenterhooks, fresh violence erupted in the occupied West Bank when Israeli forces killed two Hamas militants said to be behind an August attack that killed four settlers, one of them pregnant.
And in east Jerusalem, two stone-throwing Palestinian boys were run over and injured by a car driven by a hardline Jewish settler leader.
US Secretary of State Hillary Clinton reassured Abbas that Washington would try to coax Israeli Prime Minister Benjamin Netanyahu into renewing settlement curbs "until the very last minute," Abu Rudeina told AFP earlier.
In response, the Palestinian leader said he was "ready to resume negotiations on condition there is a clear freeze of the settlement activities."
Netanyahu has made no move to renew the freeze, partly because he does not have the support for that within his mostly right-wing coalition.
On Friday, his spokesman could only say Israel was "interested in continuing the direct negotiations" aimed at securing a peace agreement within one year, and "hopes that the other side will not leave the table."
Abbas had hinted to Palestinian officials in Amman that the crisis could even see him tendering his resignation in Sirte, an official with the Palestinian National Council said.
For the Palestinians, Jewish settlements are a major threat to the establishment of a viable future state in the West Bank, and they see the freezing of settlements as a crucial test of Israel's intentions.
But Netanyahu on Thursday deflected blame towards the Palestinians.
"The question needs to be directed to the Palestinians: why are you abandoning the talks?" he told reporters.
"Don't turn your backs on peace; stay in the talks. This is what needs to be asked today, and not of the Israeli government."