Israel said on Sunday it was suspending contacts with European Union bodies involved in peace efforts with Palestine after the bloc started requiring the labeling of exports from Israeli settlements in the occupied West Bank.

The Israelis Prime Minister Benjamin Netanyahu, who is also the foreign minister, ordered the ministry to carry out "a reassessment of the involvement of EU bodies in everything that is connected to the diplomatic process with the Palestinians", a ministry statement said.

"Until completion of the reassessment, the Prime Minister has ordered a suspension of diplomatic contacts with the EU and its representatives in this matter."