Israel warned Thursday against a proposal to ease sanctions on Iran in return for the freezing of its nuclear program, saying it would be "a mistake of historic proportions."

"Israel understands that there are proposals on the table in Geneva today" which would "allow Iran to retain the capabilities to make nuclear weapons," Prime Minister Benjamin Netanyahu said at a Jerusalem conference.

Secretary of State John Kerry held talks with Jordan's king Thursday after reaffirming U.S. opposition to Israeli settlements, as the contentious issue threatens to derail the peace process.

The top U.S. diplomat met with King Abdullah II in Amman and was later to hold talks with Jordanian Foreign Minister Nasser Judeh.

An Israeli court on Wednesday acquitted Avigdor Lieberman on corruption charges, paving the way for the hardline nationalist to return to the post of foreign minister.

The anticipated return of Lieberman -- a tough-talking former bouncer with a history of incendiary anti-Arab rhetoric -- could further complicate already faltering U.S.-brokered talks with the Palestinians.

The Palestinians accused Israel Wednesday of trying to wreck peace talks with plans to build 1,500 new settler homes in east Jerusalem, hours after it freed 26 Palestinian prisoners.

A spokesman for Palestinian president Mahmoud Abbas, Nabil Abu Rudeina, said the move "destroys the peace process and is a message to the international community that Israel is a country that does not respect international law".

Israeli Prime Minister Benjamin Netanyahu and Interior Minister Gideon Saar have agreed to build 1,500 new homes in the east Jerusalem settlement of Ramat Shlomo, Israeli army radio said Wednesday.

The early-morning report came shortly after Israel freed 26 veteran Palestinian prisoners alongside U.S.-brokered peace talks.

Israel on Tuesday was preparing to release 26 long-serving Palestinian prisoners, the second batch of 104 inmates who are to be freed in line with commitments to U.S.-brokered peace talks.

The release, which is due to take place late on Tuesday night, will see 21 prisoners returned to their homes in the West Bank and the remaining five returning home to the Hamas-run Gaza Strip.

U.S. President Barack Obama spoke to Prime Minister Benjamin Netanyahu about Iran Monday, a day after the Israeli leader warned Tehran could convert uranium into weapons-grade material within weeks.

The White House said in a short statement that the leaders discussed Iran, Israeli-Palestinian peace efforts and other key issues.

Germany has warned Israel to attend a periodic U.N. human rights review on Tuesday or face "severe diplomatic damage", Haaretz newspaper reported on Sunday.

Israel cut all ties with the Geneva-based U.N. Human Rights Council in March 2012, after it announced it would probe how Israeli settlements may be infringing on the rights of Palestinians.

Israel's housing minister on Thursday called for doubling the number of Jewish settler homes in the southern West Bank city of Hebron, even as peace talks continue with the Palestinians.

Uri Ariel, who leads the far-right Jewish Home party and lives in a West Bank settlement himself, told army radio he supported "concrete plans for the construction of 100 (new) homes in Hebron."

Israeli Prime Minister Benjamin Netanyahu will not be meeting with Pope Francis in three days, a diplomatic source said Sunday, after the premier's office had previously said they would.

A statement from Netanyahu's office had said the premier would be "meeting Pope Francis next Wednesday at the Vatican" and with U.S. Secretary of State John Kerry for updates on nuclear talks with Iran and negotiations with the Palestinians in Rome.