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In a major policy shift, the Trump administration has said that it no longer believes the Israeli settlements in the West Bank are illegal, asserting that the previous opinion that such structures were inconsistent with international law has not helped the peace process in the Middle East.
Secretary of State Mike Pompeo made the announcement on Monday, drawing praise from Israelis and condemnation from the Palestinians.
"After carefully studying all sides of the legal debate," the United States "believes the establishment of Israeli civilian settlements in the West Bank is not per se inconsistent with international law," he said.
"Calling the establishment of civilian settlements inconsistent with international law hasn't worked. It hasn't advanced the cause of peace," Pompeo said, referring to the stalled peace talks between the Israelis and the Palestinians.
According to the BBC, nearly 600,000 Jews live in about 140 settlements built since Israel's occupation of the West Bank and East Jerusalem in 1967.
The settlements are widely considered illegal under international law.
The Palestinians have long called for the removal of all settlements.
Israeli Prime Minister Benjamin Netanyahu praised the decision, saying "the US adopted an important policy that rights a historical wrong when the Trump administration clearly rejected the false claim that Israeli settlements in Judea and Samaria (a term for the West Bank) are inherently illegal under international law."
The US decision was the latest of "unceasing attempts to replace international law with the 'law of the jungle,'" Saeb Erekat, the chief Palestinian negotiator, was quoted as saying by the New York Times.
Explaining the reasons behind the decision, Pompeo said the US recognises - as have Israeli courts - the legal conclusions relating to individual settlements must depend on an assessment of specific facts and circumstances on the ground.
Therefore, the US government is expressing no view on the legal status of any individual settlement, he said.
"The Trump administration is reversing the Obama administration's approach towards Israeli settlements," Pompeo told reporters.
The Israeli legal system affords an opportunity to challenge settlement activity and assess humanitarian considerations connected to it. Israeli courts have confirmed the legality of certain settlement activities and has concluded that others cannot be legally sustained, he noted.
According to Pompeo, US public statements on settlement activities in the West Bank have been inconsistent over decades.
In 1978, the (Jimmy) Carter administration categorically concluded that Israel's establishment of civilian settlements was inconsistent with international law. However, in 1981, President Ronald Reagan disagreed with that conclusion and stated that he did not believe that the settlements were inherently illegal.
Subsequent administrations recognised that the unrestrained settlement activity could be an obstacle to peace, but they wisely and prudently recognised that dwelling on legal positions did not advance peace, he said.
However, in December 2016, at the very end of the previous administration, the then Obama administration changed decades of this careful, bipartisan approach by publicly reaffirming the supposed illegality of settlements, Pompeo said.
"After carefully studying all sides of the legal debate, this administration agrees with President Reagan," he added.
"We are not addressing or prejudging the ultimate status of the West Bank. This is for the Israelis and the Palestinians to negotiate. International law does not compel a particular outcome, nor create any legal obstacle to a negotiated resolution," Pompeo said.
"The conclusion that we will no longer recognise Israeli settlements as per se inconsistent with international law is based on the unique facts, history, and circumstances presented by the establishment of civilian settlements in the West Bank. Our decision today does not prejudice or decide legal conclusions regarding situations in any other parts of the world," he said.
He said the hard truth was there will never be a judicial resolution to the conflict, and arguments about who is right and wrong as a matter of international law will not bring peace.
This is a complex political problem that can only be solved by negotiations between the Israelis and the Palestinians, he observed.
Reiterating that the US remains deeply committed to helping facilitate peace, and will do everything to help this cause, Pompeo said the US encourages the Israelis and the Palestinians to resolve the status of Israeli settlements in the West Bank in any final status negotiations.
Senator Ted Cruz, a member of the Senate Foreign Relations Committee, applauded the decision. "Today's decision also takes another step in reversing the disgraceful legacy of the Obama administration and United Nations Security Council Resolution 2334," he said.
More than half a dozen Democratic Congressmen in a joint statement said that by announcing that it would no longer consider Israeli settlements built in disputed territory to be against international law, the Trump administration has "singlehandedly" unravelled decades of US policy.
"It's clear the Administration has no plan to bring Israelis and Palestinians together in good faith," said the statement issued by Democratic Congressmen David Price, Jan Schakowsky, John Yarmuth, Gerry Connolly, Barbara Lee, Peter Welch, Alan Lowenthal, Lloyd Doggett, and Earl Blumenauer.