The US has dismissed reported discussions between Israeli Prime Minister Benjamin Netanyahu and Washington officials over plans to annex Jewish settlements in the occupied West Bank.

"Reports that the United States discussed with Israel an annexation plan for the West Bank are false," said White House spokesman Josh Raffel, late on Monday. "The United States and Israel have never discussed such a proposal."

Raffel added the "focus remains squarely" on US President Donald Trump's "Israeli-Palestinian peace initiative".

The Israeli prime minister was quoted as telling a meeting of Likud legislators: "On the subject of applying sovereignty, I can say that I have been talking to the Americans about it for some time."

Netanyahu was referring to applying Israeli law to the settlements, which are currently under the jurisdiction of Israel's military.

Netanyahu's office later sought to clarify what was discussed, saying in a statement the prime minister "updated the Americans on the initiatives being raised in the Knesset".

On Sunday, Netanyahu blocked a bill to annex settlements that was proposed by right-wing Likud lawmakers.

"The Americans expressed their unequivocal position that they are committed to advancing President Trump's peace plan," Netanyahu's office said.

Palestinian reaction

Responding to Netanyahu's reported comments, a senior Palestinian official said the statements confirmed "Israel's commitment to apartheid".

Saeb Erekat of the Palestine Liberation Organisation said on Monday any unilateral moves to annex Palestinian land would violate their right to self-determination and independence, while confirming "US complicity with Israeli colonial plans".

"This is a confirmation that final status issues are being unilaterally decided upon by Israel in coordination with the US administration," Erekat said in a statement.

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Israel occupied the Gaza Strip, West Bank, and East Jerusalem in 1967. Today, between 600,000 and 750,000 Israeli settlers live in more than 200 Jewish-only settlements in the occupied West Bank and East Jerusalem.

The settlements are illegal under international law and violate the Fourth Geneva Convention, which states an occupying power cannot transfer its population into the territory it occupies.

Nabil Abu Rudeineh, spokesman for Palestinian Authority President Mahmoud Abbas, said any unilateral decision to annex the settlements "would only result in more tension and instability", Palestinian news agency Wafa reported.

Israeli legislation to annex the settlements "would destroy every international effort that aims to salvage the peace process", Abu Rudeineh said.