U.S. President Barack Obama’s administration is examining taking action against the construction in the West Bank and East Jerusalem, rather than making do with issuing denunciatory statements.

Senior Israeli officials said that White House officials held a classified discussion a few weeks ago about the possibility of taking active measures against the settlements.

A few senior American officials approached by Haaretz did not deny this, but refused to disclose more details. National Security Council spokeswoman Bernadette Meehan refused to comment.

A discussion on such a sensitive and politically-loaded issue in the White House is extremely irregular and shows to what extent relations between the Obama administration and Netanyahu government have deteriorated. In recent years European states have imposed increasing sanctions against the construction in the settlements, while the United States has made do with denunciations.

An Israeli official who was briefed by the Americans on the issue said the administration started discussing it following Prime Minister Benjamin Netanyahu’s last meeting in the White House in early October and the public confrontation over the settlements that occurred later.

A day before Netanyahu’s visit to the White House, settlers moved into seven houses they bought in the Palestinian village of Silwan in East Jerusalem. A few hours before the meeting, Peace Now reported that the Jerusalem municipality had given its final approval to building 2,600 housing units in Givat Hamatos, a neighborhood beyond the Green Line in Jerusalem.

A few minutes after Netanyahu and Obama had ended their meeting, White House spokesman Josh Earnest rebuked Israel in an unusually harsh statement. He said the Israeli moves “poison the atmosphere” and distance Israel from “even its closest allies.”

Netanyahu dismissed the White House rebuke and told Israeli reporters and again in an interview with CBS that the criticism goes “against American values.”

Netanyahu’s response, which seemed like a personal political attack on Obama, exacerbated the anger in the White House.

The failure of the Netanyahu-Obama meeting and the administration’s growing anger over the settlement construction led to the understanding that denunciatory statements, no matter how harsh, have become ineffective. Meanwhile, the continued construction in the settlements, especially in places like Givat Hamatos, threatens to make the two-state solution impossible.

That prompted a White House decision to examine changing its policy and taking harsher measures in response to the construction.

The discussion was attended by senior White House and State Department officials who deal with the Israeli-Palestinian issue. The Israeli official said that several steps were proposed to make it clear to the Israeli government that the United States objects to building in the settlements and to the construction’s negative repercussions.

For example, the United States may refrain from vetoing condemnatory resolutions against the settlements in the UN Security Council. Or it could issue clearer instructions to American officials about the ban on cooperating with the settlements or funding activity in them.

The White House has not yet decided on steps against the settlements and when, if at all, to carry them out. Significant steps against the settlements may exact a heavy political price from Obama, while symbolic steps would be meaningless and have no effect.

In addition, it isn't yet clear how the decision to hold early elections will affect the White House's decisions regarding the settlements. One of the aspects of this that is being looked into by the U.S. government is whether American action against the settlements at this point would weaken Netanyahu in Israeli public opinion, or do just the opposite, by portraying him as one who doesn’t cave in to international pressure.