JERUSALEM (AP) -- Israel on Thursday abruptly called off a release of Palestinian prisoners, sending U.S. Secretary of State John Kerry's troubled Mideast peace efforts further into a tailspin.
The Israeli announcement, made in reaction to a renewed Palestinian push for membership in United Nations agencies, deepened the crisis in U.S.-led peace talks and made Kerry's goal of extending negotiations past a late-April dateline a more distant possibility.
Israel's chief negotiator, Tzipi Livni, said the Palestinians' decision to seek accession to 15 international conventions through the U.N. violated the terms of the promised prisoner release, which would have been the fourth since talks resumed last summer. The Palestinians submitted their applications after Israel failed to carry out the release, as promised, by the end of March. Israel carried out the first three prisoner releases, but balked at the final one without assurances that the Palestinians would extend negotiations.
"New conditions were established and Israel cannot release the fourth batch of prisoners," Livni said in a statement.
In Washington, White House spokesman Jay Carney said the Israeli move "creates problems" but that U.S.-mediated efforts to bring the sides together were continuing. "Neither side has indicated that they want to walk away from the talks," Carney said.
"Despite the fact that there has been some progress, there is still a gap, and the Israelis and Palestinians must decide whether they will take the necessary steps to close that gap," he added. "The United States cannot impose an agreement on either side."
Earlier Thursday, a frustrated Kerry exhorted leaders on both sides to "lead" and to do so now to prevent the negotiations from collapsing.
Kerry called it a "critical moment" for the peace process and vowed to continue his efforts "no matter what." But he added there are limits to what the Obama administration can do to push the parties together and said it would be a "tragedy" if the talks failed.
"You can facilitate, you can push, you can nudge, but the parties themselves have to make fundamental decisions and compromises," he said, speaking in Algeria, where he was participating in strategic security talks. "The leaders have to lead and they have to be able to see a moment when it's there."
Under heavy pressure from Kerry, Israel and the Palestinians resumed peace talks last July, agreeing to a nine-month negotiating period with the aim of reaching a final peace deal. With little to show for his efforts, Kerry is now trying to broker a more modest "framework" agreement, in hopes of extending talks past the April 29 deadline through the end of the year to complete a deal.
Under the original negotiating formula, Israel promised to release 104 long-serving Palestinian prisoners in four groups, while the Palestinians put on hold their campaign for joining U.N. agencies.
After the Palestinians won acceptance as a nonmember state at the U.N. General Assembly in 2012, they now qualify for membership in dozens of international agencies. Israel says that joining these bodies is an attempt to bypass negotiations. It also fears the Palestinians will use their newfound status to push an anti-Israel agenda.
The Palestinians say the final release was already promised and should not be connected to any other issue. U.S. officials have also said that Israel was expected to carry out the release.
The prisoner issue is emotional on both sides after decades of conflict. Palestinians view the roughly 5,000 people held by Israel as heroes in their struggle regardless of the reason for their imprisonment -- even when their crimes involved grisly killings. In Israel, they are widely seen as terrorists. The prisoners involved in the latest releases were convicted of bloody attacks on Israeli civilians, and the scenes of them returning home to jubilant celebrations have angered the Israeli public.
Naftali Bennett, a hard-line Israeli Cabinet minister, said Palestinian President Mahmoud Abbas "has blown up the peace talks."
"If he wants to go to the U.N., I will buy him the ticket and there he will face a personal lawsuit for war crimes for daily supporting the killers of women and children," he told Channel 2 TV.
The Palestinians condemned the Israeli announcement. "Israel didn't fulfill the agreement sponsored by the U.S. concerning the release ... of prisoners in return for the Palestinian Authority not going to the U.N," said Issa Qaraqe, the minister for prisoner affairs.
At the same time, Palestinian officials say they will not formally break off the negotiations before April 29, the U.S. target date for a framework agreement, because they don't want to be blamed for derailing Kerry's mission.
The Palestinian decision to apply to 15 international conventions this week prompted Kerry to cancel a planned return to the region. It remains unclear if or when he will come back on his current overseas trip. U.S. officials have been in touch with the sides to find a formula to extend the talks that could include an additional prisoner release and a freeze to some Israeli settlement construction on lands the Palestinians want for a state. The U.S. has dangled the possibility of freeing Jonathan Pollard, a convicted American spy, as an incentive to Israel.
In his first public comments since cancelling a trip to the West Bank, Kerry made his impatience clear, but acknowledged he could not force the sides to continue the talks, let alone resolve their decades-old conflict.
He recalled the old adage that you can lead a horse to water but can't make it drink.
"Now is the time to drink," Kerry said. "The leaders need to know that."
Associated Press writers Matthew Lee in Algiers, Algeria, and Mohammed Daraghmeh in Ramallah, West Bank, contributed to this report.
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