US President Donald Trump said on Thursday he will likely release his long-awaited "peace plan" for the Middle East before Israeli Prime Minister Benjamin Netanyahu visits Washington, DC, next week.

Speaking to reporters on Air Force One en route to Miami for a political event, Trump said Palestinians might react negatively to his plan at first, but that it would benefit them.

"It's a great plan," said Trump, who will meet with Netanyahu at the White House on Tuesday. "It's a plan that really would work." He is also expected to meet Netanyahu's election rival, Benny Gantz.

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Trump said his administration has talked briefly to the Palestinians, who have rejected the administration's peace plan before it even comes out.

"We've spoken to them briefly. But we will speak to them in a period of time," Trump said.

Nabil Abu Rudeineh, a spokesman for Palestinian President Mahmoud Abbas, said earlier on Thursday that Palestinians "warn Israel and the US administration not to cross any red lines".

Trump had earlier appeared to dispel rumours that the plan would be released next week, tweeting that "details and timing of our closely-held peace plan are purely speculative".

But onboard Air Force One, he confirmed that the plan would be released before Netanyahu's visit.

The launch of Trump's plan to end the decades-long conflict between Israel and the Palestinians has been delayed numerous times since it was first mooted more than two years ago. Prospects for a breakthrough appear dim and details of the plan have been kept under wraps.

Dead in water

Palestinians have called Trump's proposal dead in the water, even before its publication, pointing to what they see as his pro-Israel policies.

The Trump administration has reversed decades of US policy on the conflict, refraining from endorsing the "two-state solution" - the longtime international formula which envisages a Palestinian state co-existing with Israel.

It has also recognised Jerusalem as Israel's capital and moved its embassy there. More recently, US Secretary of State Mike Pompeo announced in November that the US no longer viewed Israel's settlements on West Bank land as "inconsistent with international law", reversing decades of policies that were in line with most of the international community, which views settlements as illegal under international law.

Palestinian protesters in the occupied West Bank city of Nablus holds posters of US President Donald Trump during a protest against the US decision to recognise Jerusalem as Israel's capital [File: Majdi Mohammed/AP Photo]

Netanyahu announced during an election campaign last September that he intends to annexe the Jordan Valley, a large swath of the Israeli-occupied West Bank.

Abbas's Palestinian Authority (PA) has publicly refused to engage politically with the Trump administration.

They fear the plan will dash their hopes for an independent state in the West Bank, East Jerusalem and the Gaza Strip.

"If this deal is announced with these rejected formulas, the leadership will announce a series of measures in which we safeguard our legitimate rights, and we will demand Israel assume its full responsibilities as an occupying power," Abu Rudeineh said on Thursday. He appeared to be referring to oft-repeated threats to dissolve the Palestinian Authority, which has limited autonomy in parts of the Israeli-occupied West Bank. That would force Israel to resume responsibility for providing basic services to millions of Palestinians.

Economic side of plan

The White House in June announced the economic piece of the Trump peace plan and sought support for it at a conference of global finance ministers in Bahrain, which was boycotted by the Palestinians.

It proposes a $50bn investment plan that would create a global investment fund to lift the Palestinian and neighbouring Arab state economies, and fund a five-billion-dollar transportation corridor to connect the occupied West Bank and Gaza.

Palestinian leaders said the gathering avoided a political settlement based on a two-state solution, describing it as an attempt by the US administration and some of its allies in the region to "liquidate" the Palestinian cause.

Jared Kushner makes his opening speech at Bahrain Workshop in Manama, Bahrain [Reuters]

Trump's son-in-law Jared Kushner, the White House adviser behind the plan, has previously said it will not mention a two-state solution because "it means one thing to the Israelis, it means one thing to the Palestinians", despite the notion of a two-state solution being the bedrock of talks in the past.

In an interview last year with Al Jazeera, Kushner offered a glimpse of what the political process could look like.

"I think we all have to recognise that if there ever is a deal, it's not going to be along the lines of the Arab peace initiative. It will be somewhere between the Arab peace initiative and somewhere between the Israeli position," he said.

Speaking to reporters on Thursday, Trump said he was surprised that both Netanyahu and Gantz were willing to take a break from campaigning for the March 2 elections to join him in Washington, DC.

The US was believed to be holding back on releasing the peace plan until Israel had a permanent government. Those calculations may have changed as the deadlock in Israeli politics looks to be further prolonged.

Trump may also be looking for a boost from evangelical and pro-Israel supporters as the Senate weighs whether to remove him from office after he was impeached last month, and as he gears up for a re-election battle this year.