The Palestinian president, Mahmoud Abbas, has apologised after he was accused of antisemitism following a speech in which he suggested that historical persecution of European Jews had been caused by their conduct, not by their religion.

Israel’s prime minister, Benjamin Netanyahu, had condemned Abbas after he claimed past massacres including the Holocaust were related to the “social function” of Jews in banking.

“Once a Holocaust denier, always a Holocaust denier,” Netanyahu tweeted on Wednesday. “I call upon the international community to condemn the grave antisemitism of Abu Mazen [Abbas’s nickname], which should have long since passed from this world.”

Abbas, 82, made the comments during a wide-ranging speech on Monday in Ramallah, West Bank, which also drew condemnation from the U S and the E U.

On Friday, Abbas said he rejected antisemitism “in all its forms” and called the Holocaust the “most heinous crime in history” in a statement issued by his office in Ramallah after a four-day meeting of the Palestinian National Council (PNC).

“If people were offended by my statement in front of the PNC, especially people of the Jewish faith, I apologise to them. I would like to assure everyone that it was not my intention to do so, and to reiterate my full respect for the Jewish faith, as well as other monotheistic faiths,” he said in statement published in English and Arabic.

The Israeli defence minister, Avigdor Lieberman, rejected Abbas’s apology. He wrote on Twitter: “Abu Mazen is a wretched Holocaust denier, who wrote a doctorate of Holocaust denial and later also published a book on Holocaust denial. That is how he should be treated. His apologies are not accepted.”

In his 1982 doctoral thesis, titled The Other Side: The Secret Relationship Between Nazism and Zionism, Abbas questioned the extent of the Nazi genocide, arguments that led to accusations of antisemitism. He has since distanced himself from those claims, and rejects suggestions that he is a Holocaust denier.

After serving for decades as a deputy to Yasser Arafat, the ailing leader became president in 2005 and has been accused of authoritarianism. Often portrayed as clinging to power, Abbas was re-elected this week as chairman of the Palestine Liberation Organisation’s (PLO) executive committee.

During his more than two-hour-long speech on Monday, Abbas jumped between angrily rejecting the US as peace mediator and his views on world history, which included calling Israel a “colonial enterprise that has nothing to do with Jewishness”.

Abbas suggested in his address that Jewish people’s relations with banking and moneylending had led to persecution against them.

“From the 11th century until the Holocaust that took place in Germany, those Jews – who moved to western and eastern Europe – were subjected to a massacre every 10 to 15 years. But why did this happen? They say: ‘It is because we are Jews,’” he said.

He cited “three books [written by Jews]” as evidence that “hostility against Jews is not because of their religion, but rather their social function”, saying he meant their “social function related to banks and interest”.

The EU’s foreign service said the remarks were “unacceptable”.

The UN special coordinator for the Middle East, Nikolay Mladenov, called the speech “disturbing”, adding that it repeated “some of the most contemptuous antisemitic slurs”.

“The Holocaust did not occur in a vacuum, it was the result of thousands of years of persecution. This is why attempts to rewrite, downplay or deny it are dangerous.”

David Friedman, the US ambassador to Israel, accused Abbas of reaching to a new low, while Donald Trump’s Middle East envoy, Jason Greenblatt, said: “Peace cannot be built on this kind of foundation.”

The US Holocaust Memorial Museum dismissed the remarks as “grossly inaccurate and an insidious type of antisemitism” and said Abbas was falsifying history.

“The Nazis believed that Germans were racially superior and that the Jews, deemed inferior, were a threat to the so-called German racial community and had to be eliminated,” it said in a statement.

The row comes as relations between the US and the Palestinian leadership have broken down over the American plan to move its Israeli embassy from Tel Aviv to Jerusalem.

The relocation, which is due to be completed on 14 May, sparked major protests by Palestinians, who consider East Jerusalem their capital, and led Abbas to cut ties with Trump’s administration.