U.S. President Barack Obama said on Thursday he had told Israeli Prime Minister Benjamin Netanyahu that continued Jewish settlement activity was not constructive and did not "advance the cause of peace".

Obama, speaking at a joint news conference with Palestinian President Mahmoud Abbas, said he remained committed to the creation of an "independent, viable and contiguous" Palestinian state and had not lost hope in achieving a two-state solution between Israel and the Palestinians.

But he offered no new proposals to getting there.

He said his new Secretary of State John Kerry would spend a significant amount of time and energy trying to narrow the differences between the two sides as Washington tries to move them back to long-stalled direct talks.