The Jerusalem Post says the U.S. has delayed distribution of the so-called "road map" first until after the formation of new Israeli and Palestinian governments, and now until after the Iraq crisis is settled.
Meanwhile, Israel's defense minister told the cabinet that the threat of an Iraqi attack on the Jewish state remains, reports CBS News Correspondent Robert Berger. He said U.S. forces do not control all areas in western Iraq from which Scud missiles could be fired at Israel.
Haaretz reports the U.S. has reached a secret agreement with the designated Palestinian prime minister, Mahmoud Abbas, to delay until after the new Palestinian cabinet is sworn in and possibly until after the war.
President Bush earlier this month called for both Israelis and Palestinians contribute toward drawing up a Middle East "road map."
At the same time, Israel's Defense Ministry wants to move a separation fence between Israel and the Palestinians further eastward, including a larger chunk of the West Bank and more Jewish settlements, a spokeswoman said Sunday. That would put some 40,000 settlers and some 3,000 Palestinians are included in the western, Israeli side of the fence.
Palestinian officials said the new barrier is an attempt to sabotage the U.S.-backed plan for Palestinian statehood. They said they would complain to the Quartet of Mideast mediators — the United States, the European Union, the United Nations and Russia.
American sources expect Abbas, known as Abu Mazen, to replace Yasser Arafat loyalists in the Interior and Justice ministries. Interior controls security functions, an area Arafat had reserved for his own control.
Last month, after it was reported that Israel had proposed more than 100 amendments to the peace plan, other countries exerted heavy pressure on the U.S. to publish the document as is and not to accept further comments and amendments.
However, Haaretz reports Israel has received permission from Washington to present its comments and criticisms of the "road map," as long as they constructive and conducive to the plan's implementation.
Israel began constructing the physical barrier last year to try to keep out Palestinian militants.
According to the initial plan, parts of the fence were to run along the now-invisible Green Line, which demarcated the frontier before Israel captured the West Bank from Jordan in the 1967 Mideast war. Other stretches were to run somewhat further to the east, encompassing several West Bank villages with a total of about 11,000 residents.
However, the Defense Ministry now recommends altering the plans and building the barrier deeper in the West Bank, said ministry spokeswoman Rachel Niedak-Ashkenazi.
Hundreds of acres of Palestinian land have already been expropriated for fence construction.
Defense officials will formally present the plan to Prime Minister Ariel Sharon in coming days. Haaretz said Sharon supports the idea in principle, and wants the fence to be seen as the border of a temporary Palestinian state which, according to the U.S.-backed peace plan, is to be established by the end of the year.
Haaretz said the Defense Ministry also wants to erect a second line of separation even further to the east to protect Jewish settlements not shielded by the first barrier.
Israel's frontier with the West Bank is 228 miles long. The government has decided in principle to fence off the whole line but has not yet mapped out the entire route.
Palestinian Cabinet minister Saeb Erekat accused Israel of trying to sabotage international peace efforts, at a time when the world's attention is diverted by the fighting in Iraq. "This is part of Israel's exploitation of the war in Iraq," Erekat said.
He said he would seek clarifications from the Quartet.
The Palestinian Authority has been assured by top U.S. officials that the peace plan, which envisions full Palestinian independence by 2005, would be unveiled as soon as a Palestinian prime minister is sworn in. That could happen next month, after Abbas has formed a new Cabinet.
Israel has asked for more discussion on the plan. "It (the planned change in the course of the barrier) is a serious effort by the Israelis to undermine the Quartet's roadmap," Erekat said.