US President Barack Obama has urged the Israelis and Palestinians to resume direct peace talks before a settlement freeze expires in September.

He spoke after Oval Office talks with Israeli PM Benjamin Netanyahu, who said it was "high time" for direct talks.

The two leaders also played down any suggestion of a rift between the US and Israel, with Mr Obama saying the bond was "unbreakable".

Mr Obama praised Israel for announcing it would ease its Gaza Strip blockade.

The US president said he hoped direct peace talks would resume "well before" Israel's 10-month moratorium on building new settlements in the West Bank expired at the end of September.

The Israeli prime minister has been under pressure from his right-wing coalition not to cave in to US calls to extend the freeze.

"I believe Prime Minister Netanyahu wants peace. I think he is willing to take risks for peace," said Mr Obama.

Mr Netanyahu said steps were being taken in the coming days and weeks to further the peace process, but he gave no further details.

The Palestinians withdrew from direct negotiations after Israel launched the Operation Cast Lead offensive in Gaza in late 2008.

Scheduled indirect talks were called off in March this year when Israel approved plans for 1,600 homes in East Jerusalem, where the Palestinians want the capital of their future state.

'Tougher' sanctions

That announcement, as US Vice-President Joe Biden was visiting to launch the negotiations, triggered a crisis in relations between Israel and its greatest ally, Washington.

Analysis The two leaders were all smiles and both said they had had excellent discussions. Barack Obama said the bond with Israel was "unbreakable", Benjamin Netanyahu said reports about the demise of the US-Israeli relationship were "flat wrong". So on atmospherics it's a success: the spat appears over; in fact, listening to the two men it never even happened. But on substance there was little. Mr Netanyahu spoke of concrete steps to be taken in the coming days and weeks to further the peace process but he gave no further details. It was expected that Mr Obama would ask Mr Netanyahu to extend a freeze on Israeli settlement building in occupied territory beyond a September deadline. It looks as though that is not happening. Mr Obama said he wants direct talks between Israelis and Palestinians to start well before September and once those talks start, he said, the two parties should not seize on actions by the other side to stop talking.

The US president gave Mr Netanyahu a frosty reception at the White House during their last encounter later that month.

Indirect talks finally got under way in May with US Middle East envoy George Mitchell shuttling between the two sides in Jerusalem and Ramallah in the West Bank.

The Palestinians have refused to sit down with Mr Netanyahu until he agrees to freeze construction in areas they want for an independent state. But Israel recently said it has no intention of doing that.

Mr Netanyahu warned during the White House talks that the main threat facing Israel was Iran's nuclear programme, although Tehran denies claims it is building atomic weapons.

The Israeli prime minister praised new US sanctions on Iran that Mr Obama signed last week, but urged "much tougher" measures from other nations.

It was Mr Obama and Mr Netanyahu's first meeting since Israel's May raid on a Gaza-bound aid flotilla that killed nine Turkish activists and triggered a regional diplomatic crisis.

Mr Netanyahu was snubbed by President Obama during their last encounter in March, when the US president refused even to allow a photo of their meeting to be released.

Afternoon tea

Correspondents say Tuesday's bilateral appeared much warmer, with US First Lady Michelle Obama inviting Mr Netanyahu's wife, Sara, for afternoon tea.

As the two leaders emphasised how strong their bond was, protesters gathered across the road in Lafayette Park and chanted "No More Aid [to Israel]. End the [Gaza] Blockade".

During his three-day US visit, Mr Netanyahu is also expected to travel to New York, where he will meet UN Secretary General Ban Ki-moon and address Jewish American leaders.

Image caption Protesters outside the White House called for no more US aid to Israel

Palestinian negotiator Saeb Erekat said Mr Netanyahu must choose between settlements and peace.

"We want to resume direct negotiations, but the problem is that the land that is supposed to be a Palestinian state is being eaten up by settlements," he told the Associated Press news agency.

Meanwhile, an Israeli human rights group, B'Tselem, says Israel's Jewish settlements have now taken over more than 40% of all the land in the occupied West Bank.

The advocacy group's report says Israel "systematically violates" and reinterprets international, as well as its own laws, to take over private Palestinian land, thus undermining peace negotiations for a two-state solution.