The Palestinians are considering “all options” in response to Israel’s decision to halt peace talks and punish the Palestinian Authority over its unity deal with Hamas, top Palestinian negotiator Saeb Erekat said Thursday.

“The Palestinian leadership will look into all options to respond to Israeli government decisions against the PA,” Erekat told AFP.

“The priority now for the Palestinians is reconciliation and national unity,” he added.

High-ranking Fatah official Jibril Rajoub insisted that a Palestinian state could not be created without unity between Palestinian factions. Despite the stated goals of Hamas to destroy Israel, Rajoub stressed to Channel 2 on Thursday, “the two-state solution is the only game in town.”

“We are not ready to cancel the endgame of the conflict,” Rajoub said, and added that because of the Palestinian unity agreement, “today you have a partner” for peace.

Palestinian Authority President Mahmoud Abbas is due to deliver a comprehensive speech on the latest developments on Saturday during the PLO Central Council meeting, the PLO announced.

Israel announced on Thursday that it was suspending peace talks over the deal, only days before the April 29 deadline marking the end of the nine-month US-brokered period of intensive discussions.

Prime Minister Benjamin Netanyahu said that Palestinian moves to form a unity government with Hamas were “a giant leap backward” for the peace process.

“The pact with Hamas kills peace,” the Israeli leader told NBC television shortly after the cabinet announced it was halting the process.

“I think that what has happened is a great reverse for peace, because we had hoped that the Palestinian Authority president Abbas would embrace the Jewish state, the idea of two nation states, Palestinian one and a Jewish one,” Netanyahu said.

“But instead, he took a giant leap backward, and made a pact with Hamas — a terror organization that calls for Israel’s destruction,” the Israeli leader said.

Under the Fatah-Hamas agreement, which came as the US-brokered peace talks were at a standstill, the sides agreed to form within weeks a “national consensus” government under Abbas, who rules the West Bank.

Abbas “had a choice: peace with Israel or pact with the terrorist Hamas, and he choose the pact with Hamas. So that’s the blow for peace, and I hope he changes his mind,” Netanyahu added. “As long as I am prime minister of Israel, I will never negotiate with a Palestinian government backed by terrorist organizations committed to our destruction.”

He called for clarity, saying Abbas “can’t have both, he really has to choose: peace with Israel or a pact with Hamas.”