While the US State Department publicly insisted the official Obama Administration on the Israeli settlements had not changed, privately diplomats are saying that the adminstration has done a virtual 180, backing off pretty much all its demands with respect to Israel’s settlement activity.
At this point, the US had agreed to completely abandon complaints over Israeli construction in East Jerusalem, which Israel occupied in 1967. Though the US will not publicly endorse the continued construction it will no longer ask Israel to freeze them.
About all they got was a dubious promise from the Netanyahu government to not issue new construction permits for settlements in the West Bank for nine months. Even this promise likely means little, as thousands of already approved construction projects will continue in the meantime and the Israeli government is already talking about an exit strategy from the program, even though it hasn’t officially halted the permits yet.
The Palestinian Authority has previously said it will not return to the peace talks without a halt to the settlement expansion, and in all likelihood a brief pause in new permits will likely not be sufficient to them. Since the Israelis are giving President Obama everything he is asking for at this point (which is to say, virtually nothing) this may result in the US returning to its familiar role of cheering Israel as a peacemaker while chastising the Palestinians.