French President Nicolas Srakozy on Tuesday said his country stands with the United States in condemning Israeli settlement activity in East Jerusalem.

Sarkozy said his own commitment to Israel's security is well known but adds that the settlement activity in an area claimed by the Palestinians "contributes nothing."

Speaking at a news conference with U.S. President Barack Obama after their White House meeting, Sarkozy praised Obama for trying to engage the two sides in peace talks.

Sarkozy said that the "absence of peace" in the region "is a problem for all of us" - and that it feeds terrorism around the world.

Obama, meanwhile, said he thinks Netanyahu understands that he will have to "take some bold steps" when it comes to advancing the Israeli-Palestinian peace process, in an interview with MSNBC on Tuesday.

"I think Prime Minister Netanyahu intellectually understands that he has got to take some bold steps. I think politically he feels it. But it's not just on the Israeli side. I've been very clear that the Palestinians have to take steps," Obama said.

The U.S. president also said that the recent tension between his administration and the Israeli government is merely a "disagreement among friends" and emphasized the strength of the bond between the United States and Israel.