Israeli security forces arrested on Sunday morning two Palestinians suspected of plotting to carry out an armed attack, Army Radio reported.

The two were detained at the Hawara checkpoint near the West Bank city of Nablus. A search of their belongings yielded improvised grenades, petrol bombs and knives. Bomb squad officers disarmed the grenades and security forces were scouring the area, according to the report.

The suspects, whom police estimated were members of a local militant cell, carried a letter which indicated their intention to commit suicide, the report said.

The incident comes after Israel's Shin Bet security service last Thursday reported that ten Israelis were killed in terror attacks in 2012, a 55 percent drop from the previous year. Six of them were civilians and the rest security forces personnel.

Shin Bet noted that none of the victims were killed in the West Bank or Jerusalem, for the first time since 1973. The agency also claimed to have thwarted 100 "major" terror attacks in 2012.

Army Radio on Sunday quoted assessments by the security establishment that the deep impasse in the diplomatic process between Israel and the Palestinian Authority could lead to an escalation of violence in the West Bank.