Israeli Prime Minister Benjamin Netanyahu and Defence Minister Ehud Barak have "agreed" on fighting the Iranian threat in all its forms and on managing ties with the United States, a joint statement said.

The defence minister had reportedly expressed views that conflicted with the prime minister's over the Iran nuclear issue during a recent visit to the United States, which favours sanctions and diplomacy over military action.

"The prime minister and the defence minister agreed on the fight against the Iranian threat in all its forms as well as on the management of relations with the United States under the leadership of the prime minister," said the statement, published by Barak's office late on Saturday.

"The prime minister and the defence minister agreed to continue their cooperation in facing challenges that threaten the security of Israel."

Israeli media reported that Netanyahu was angry over a recent meeting between Barak and Chicago city mayor Rahm Emmanuel, a former chief of staff to US President Barack Obama.

During the meeting Barak disagreed with Netanyahu's demand that a "clear red line" be set for Iran by the United States over Tehran's disputed nuclear programme, according to the reports.

This demand by Netanyahu has raised tensions between Israel and the United States as Obama favours diplomacy and international sanctions against Iran to rein in its atomic programme.

Netanyahu has publicly aired his differences with the Obama administration over the Iran issue, criticising Washington for failing to set its own "red lines" that would trigger military action against Tehran.

For nearly four years, Netanyahu and Barak have presented a united front, but recently the Israeli premier has reportedly accused Barak of "manoeuvring behind his back" with Washington in a bid to present himself as a "moderate" compared to Netanyahu's "extremist" positions, local media have said.

A source close to Barak was quoted Sunday by the Yediot Aharonot newspaper saying that "at his age and given his status, the minister of defence cannot be reprimanded by anyone, not even the prime minister."

The same source said that "Barak continues to act as he wishes in Israel and abroad. He is convinced his acts are in the best interests of the government of Israel when it comes to defence ties with the United States."

The clash between Netanyahu and Barak came amid multiple reports of possible early elections in Israel, probably in February or March.

Israeli polls unanimously predict a victory for Netanyahu, leader of the Likud party and are sceptical about the success of Barak's Atzmaout party which has five MPs.

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