A senior minister warned he would pull his political faction out of the governing coalition Thursday should a reported release of Israeli Arab prisoners goes through, threatening to bring down the government of Prime Minister Benjamin Netanyahu.

Economics Minister Naftali Bennett, who leads the nationalist-religious Jewish Home party, said the faction’s 12 Knesset members would walk if a deal, meant to salvage peace talks with the Palestinians, went through. His position was formally adopted by the Jewish Home party at a meeting on Friday.

“If the proposition of releasing Israeli murderers is brought before the government, Jewish Home will oppose it,” he said in a statement late Thursday night. “If the proposal passes — Jewish Home with leave any government that releases murderers who have Israeli citizenship.”

The warning came following a report by Israel’s Channel 2 news that a deal was in the works for Israel to release the prisoners in exchange for Ramallah agreeing to extend peace talks.

An Israeli official told The Times of Israel that the reports were unfounded and that the sides had not “overcome the crisis,” referring to the seeming blowing up of peace talks over the last two weeks.

The US State Department also denied a deal was imminent, calling the report “inaccurate.”

“The gaps are narrowing, but any speculation about an agreement are premature at this time,” spokesperson Jen Psaki said.

The possible release of Israeli citizens convicted of terror-related offenses has been met with considerable opposition inside the coalition, where more hawkish politicians see it as a breach of Israeli sovereignty. Members of Jewish Home had threatened to pull out of the government last month over the same issue, as had Deputy Defense Minister Danny Danon (Likud), before Israel nixed the prisoner release.

The release, part of the last group of 104 Arab inmates Israel had agreed to free as part of a pre-talk arrangement in July, was called off at the end of last month after Palestinian Authority President Mahmoud Abbas applied to join 15 international treaties, some UN-related, which Israel saw as a breach of Ramallah’s commitment to not approach the UN for statehood recognition.

Israeli officials have demanded any deal to continue talks include a retraction of the applications, but Palestinians have steadfastly rejected reversing direction.

Bennett said a deal that included releasing prisoners with Israeli citizenship would be “a blow to Israeli sovereignty, especially as Ramallah had refused to withdraw the applications.

“This is an act of extortion and giving in to terror that we cannot abide with. It is the minimum limit of national honor and we cannot abide with it being trampled upon,” he said.

MK Ze’ev Elkin (Likud) also expressed opposition to the rumored conditions for continuing talks, saying it would send the wrong message to the world.

“Going back to a framework agreement such as this will broadcast weakness and will reward the Palestinians for their stubbornness, and only encourage their desire to bash Israel in the international arena. We must not turn the other cheek when they spit in our face,” he said.

He added that going ahead with it would cause a political shakeup that could result in new elections.

Psaki told reporters Thursday that Israeli and Palestinian negotiators met with American mediator Martin Indyk Thursday night in an effort to find a way past the impasse and extend talks, scheduled to end April 29.

Officials indicated that the terms of a deal to continue talks would be similar to an earlier proposal, under which Israel would agree to release the fourth batch of Palestinian prisoners, including Israeli Arabs, and the US would release the long-held Israeli-American spy Jonathan Pollard.

Psaki, however, said no decision had been made about Pollard.

Abbas informed the foreign minister representatives of the Arab League Wednesday in a closed meeting that the peace talks would be extended beyond the deadline.

In an interview Thursday with the London-based Arabic daily A-Sharq al-Awsat, Abbas said the extension of the talks must be aimed at the establishment of a Palestinian state with its capital in East Jerusalem.