US Secretary of State Hillary Clinton told US lawmakers on Wednesday that she hoped Israelis and Palestinians could resume negotiations toward a peace settlement “soon.”

A year of US efforts to bring the two sides back to the negotiating table have failed so far, but Clinton struck an upbeat tone in testimony to the Senate Foreign Relations Committee.

After demanding last year that Israel halt the construction of all settlements on Palestinian land in the West Bank, the US softened its position, and is now hoping that Palestinian President Mahmoud Abbas will drop his demand that settlement construction halt before peace talks start.

"We hope that that will commence shortly," Clinton said, as quoted by Reuters. "We think it's absolutely essential that they begin to talk about the final status issues that divide them ... but we are well aware of the difficulties that confront us."

Although direct negotiations are still unlikely, Abbas could agree to participate in US-mediated “proximity talks” in which Middle East envoy George Mitchell would shuttle between Israeli and Palestinian negotiators.

According to reports, Clinton also criticized Israel’s inclusion of holy shrines in the West Bank on a list of “Israeli heritage” sites. Israel’s claim to the Ibrahimi Mosque in Hebron and Rachel’s Tomb in Bethlehem sparked protests across the West Bank and Gaza this week.