On Monday, the Trump Administration broke with decades of U.S. precedent to redefine America’s policy on Israeli settlements in the West Bank. Since President Trump took office in 2016, he has overturned long-held U.S. positions on several of the Israeli-Palestinian conflict’s most contentious issues, to the dismay of the Palestinian leadership. The White House’s latest announcement—that the U.S. will no longer consider Israeli settlements in the West Bank to be illegal under international law—is likely to further inflame those tensions. Here’s what to know.

What is Washington’s new policy on Israeli settlements in the West Bank?

“After carefully studying all sides of the legal debate,” Secretary of State Mike Pompeo told reporters on Monday, “the United States has concluded that the establishment of Israeli civilian settlements in the West Bank is not, per se, inconsistent with international law.” Pompeo added that “calling the establishment of civilian settlements inconsistent with international law hasn’t worked. It hasn’t advanced the cause of peace.”

Close to 600,000 Israelis live in West Bank settlements Israel built after it took over the territory in the Six Day War of 1967. The area is also home to almost 3 million Palestinians who live under the control of the Israeli security forces, according to the Palestinian Authority’s Central Bureau of Statistics. Almost 2 million more Palestinians live in Gaza, a 25-mile long strip administered by the militant group Hamas and subject to a 12-year-long Israeli-Egyptian blockade.

How does this differ from the past policy?

While Israel has long disputed the majority of the international community’s determination that settlements are illegal under international law, for decades the U.S. had adopted a position of compromise. The State Department, under former president Jimmy Carter, in 1978 deemed that Israeli settlements are “inconsistent with international law.” His successor, Ronald Reagan disagreed, saying in 1981 he did not believe settlements were inherently illegal. Since then, Republican and Democratic Presidents have referred to settlements as “illegitimate” but declined to call them illegal—a designation that would make them subject to international sanctions. But in one of his Administration’s last foreign policy acts, former President Barack Obama broke with that trend, declining to veto a U.N. resolution urging an end to settlements.

What could the new announcement mean for Israeli-Palestinian relations?

Palestinians say the building of Israeli settlements on land they hope to make part of a future state makes a two-state solution to the Israeli Palestinian conflict virtually impossible. The number of new settlements has risen sharply under the Trump Administration; the Associated Press charted a 39% increase in Israeli spending on West Bank settlement infrastructure in the year following Trump’s election in 2016. Pompeo’s announcement on the legal status of settlements, says Chief Palestinian negotiator Saeb Erekat, risks substituting international law with “the law of the jungle.”

It is the latest in a string of moves from the Trump Administration, which has abandoned the U.S.’s traditional role in the region as a mediator—leading to the signing of the Camp David Accords in 1978 that led to a peace treaty between Israel and Egypt, and the Oslo Accords in the 1990s, which aimed to peacefully resolve the Israeli-Palestinian conflict. In 2017, Trump moved the U.S. embassy to Jerusalem, which Palestinians also see as the capital of their future state. He has cut U.S. funding to the U.N. Agency that helps Palestinian refugees and, in a move widely considered a pre-election gift to Prime Minister Benjamin Netanyahu, recognized Israeli sovereignty over the Golan Heights, a rocky plateau in south-western Syria that Israel seized in 1967.

What does the policy mean for the upcoming Israeli election?

Experts say the White House’s announcement on the legality of Israeli settlements appears designed to handicap Israel’s centrist opposition at a time when it poses the most serious threat yet to Netanyahu’s leadership.

Despite Trump’s support, Netanyahu still faces monumental challenges. The Israeli Prime Minister failed to form a government following his narrow election victory in April, and after he failed to do so again after re-run elections in September, Israel’s President handed the mandate to centrist Benny Gantz. Netanyahu’s right wing Likud party is also preparing for the expected indictment of its leader on several corruption charges within days.

Gantz has until Wednesday to tie up negotiations, with one potential option a minority government backed by Israeli-Arab dominated parties, who now comprise the third largest voting block in Israel’s parliament. Ayman Odeh, leader of the Israeli-Arab dominated Joint List coalition wrote (in Hebrew) on Twitter that a foreign administration’s policy change will not “change the fact that the settlements were built on occupied land upon which an independent Palestinian state will be founded alongside Israel.”

While Netanyahu welcomed Pompeo’s statement as righting what he called “a historical wrong,” Gantz’s endorsement was more surprising. “I applaud the U.S. government for its important statement, once again demonstrating its firm stance with Israel and its commitment to the security and future of the entire Middle East,” he said in a statement. More ambiguously, Gantz added that the fate of the settlements “should be determined by agreements that meet security requirements and that can promote peace.”

Like the vast majority of Israel’s security establishment, experts say that Gantz—a former military chief of staff—believes any move to annex the West Bank would undermine Israel’s security and economy, and be detrimental to its future as a Jewish and Democratic state. But Gilead Sher, co-chair of the Israeli non-partisan think tank Blue and White Future, says that Gantz’s more positive response to Pomepo was “based on domestic political considerations” rather than a genuine belief that Washington’s new policy on settlements would bolster Israel’s security.

“There are several issues which the center and the left cannot oppose, despite the fact that they know that such statements or symbollic steps are detrimental to any future Israeli-Palestinian peace,” he tells TIME. The White House statement handicaps Israel’s center left at a critical juncture in coalition negotiations because it makes it “unpopular to talk about two states for two peoples.” According to polling by the Jerusalem-based Israel Democracy Institute (IDI) about half of Israelis support a two-state solution to the conflict. But IDI President Yohanan Plesner told TIME in June that support is coupled with a “deep skepticism about whether there’s any tangible prospect for that to take place.”

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Write to Joseph Hincks at joseph.hincks@time.com.