US President Barack Obama said Tuesday a two- state solution to the Israeli-Palestinian conflict is critical to any peace agreement, dpa reported.
Obama acknowledged that a new Israeli government headed by conservative Benjamin Netanyahu, who has been sceptical of a two state solution, means achieving peace will not be "easier than it was."
"We don't yet know what the Israeli government is going to look like, and we don't yet know what the future shape of Palestinian leadership is going to be comprised of," Obama said in a press conference late Tuesday.
"What we do know is this: that the status quo is unsustainable, that it is critical for us to advance a two-state solution where Israelis and Palestinians can live side by side in their own states with peace and security," Obama said.
Netanyahu, the leader of the Likud party, struck a coalition agreement with the centre-left Labour Party earlier Tuesday that will make him the country's next prime minister.
Likud placed second in February elections, but he was tapped to become prime minister because he was better positioned to form a coalition than the chief rival Kadima party.
Netanyahu has been critical of a two-state solution endorsed by Obama, former president George W Bush and most of the international community.