Prime Minister Benjamin Netanyahu's aides said Monday that he believes that the Labor Party split will actually help advance the peace process with the Palestinians.

According to Netanyahu, now that the Labor ministers left the government, the Palestinians will understand that the Israeli government will not collapse and therefore they will have no choice but to conduct direct negotiations with Israel.

"The Palestinians saw the threats of the Labor ministers and toughened their stance because they thought the Israeli government will collapse. Now they understand that the government is going nowhere and now they will return to negotiations," said sources close to Netanyahu.

It is unclear why Netanyahu and his aides are so optimistic. The eight Labor MKs who left the coalition were actually the ones who supported the advancement of the peace process, while Netanyahu was the one who refused to present a peace plan.

Open gallery view Prime Minister Benjamin Netanyahu in the Knesset. Credit: Emil Salman

A senior Israeli official who has been involved in negotiations with the Palestinians for more than 15 years heard the comments and responded with loud laughter. "If officials in the Prime Minister's Bureau think that this is the way to advance the peace process then they are disconnected from reality," he said.

Defense Minister Ehud Barak and his four allies quit the Labor Party on Monday to form the new Atzmaut faction in a process facilitated by the intensive and secret intervention of Prime Minister Benjamin Netanyahu and his associates.

The process of Labor's split began two weeks ago, after a wave of attacks on the part of party ministers against Barak after senior U.S. officials told Haaretz that the Obama administration was furious with the defense minister for "deceiving" them about his political clout with regard to the peace process.