The Financial Times newspaper published a report prepared by Andor England, in which he said that the Arab countries are preparing an initiative to stop the war in Gaza and build a Palestinian state, which may lead to the establishment of official diplomatic relations between Saudi Arabia and Israel.

England said the initiative includes securing a ceasefire, releasing the hostages first, and taking irreversible steps to create a Palestinian state.

The newspaper quoted a prominent Arab official as saying that the Arab countries hope to present their plan within weeks, as part of efforts to stop the war in Gaza and prevent the outbreak of a broader war in the Middle East.

Arab officials discussed the plan with the US and European governments, and it will include Western countries agreeing to officially recognize the Palestinian state, or support the Palestinians obtaining full membership in the United Nations.

The senior official said: “The main issue is that you need to provide hope to the Palestinians, and this cannot be done through economic benefits or removing symbols of occupation.” The initiative comes at a time when Israel is facing widespread international pressure to stop its attack on besieged Gaza, at a time when the United States has increased its diplomatic efforts to prevent the spread and outbreak of war in the region, and is pushing towards a long-term resolution in the intractable Israeli-Palestinian conflict.

US Secretary of State Anthony Blinken described the war in Gaza as “painful,” adding that what we want is a Palestinian state that “gives the people what they want, and works with Israel so that it is effective.”

When the Saudi Foreign Minister was asked, at the Davos Forum, on Tuesday, whether Riyadh would recognize Israel within a broad political agreement, he replied: “Certainly,” and “We agree that regional peace includes peace with Israel, but this only happens with peace for the Palestinians through a Palestinian state.”

On the same day, National Security Advisor Jake Sullivan stressed that the United States is focused, as part of post-war plans in Gaza, on achieving a normalization agreement between Saudi Arabia and Israel, as he said: “Our approach remains focused on moving towards stability and integration in the region.” However, there are several challenges to reaching these goals, including the Hamas attack on October 7, the Israeli leaders’ warning that the war in Gaza will continue for several months, and Israeli Prime Minister Benjamin Netanyahu’s ruling out working with the National Authority and rejecting the two-state solution. He said, in December, that he was “proud” to have prevented a Palestinian state: “Everyone knows what would happen if we surrendered to international pressure and helped with a state like this.”

Netanyahu leads an extremist government in which settlers in the West Bank and Zionist nationalist parties participate.

The Arab official commented: “In light of today’s political situation in Israel, normalization is what will prevent the Israelis from falling into the abyss.”

Saudi Arabia was moving towards normalizing relations with Israel before the attacks, as it conditioned normalization on a security treaty with the United States and support in a nuclear project for civilian purposes. American officials discussed an element of normalization related to the Palestinians, such as a limited settlement freeze in the West Bank, support for the National Authority that administers parts of the occupied territories, and a path toward a Palestinian state.

Blinken was planning to visit Riyadh in mid-October to discuss the Palestinian component of the agreement, but the attacks halted the talks. But Saudi Arabia confirmed that the option is still on the table, and it wants to ensure concessions regarding the Palestinians, including Gaza. A person familiar with the talks said: “We got the broad outlines from the National Authority,” and “Now the element must be strengthened in order for it to be politically effective at any point in the future.”

Biden, who is considered one of Israel's staunchest advocates, spoke of the two-state solution as a guarantor of Israel's security. Saudi Arabia's readiness for normalization is considered a bargaining chip with Israel, which views establishing relations with the Kingdom as a major prize for its normalization efforts with Arab countries.

Although Saudi Arabia deals with normalization as part of its plans to develop the Kingdom and make it a commercial, financial and tourism center, it is now looking at the dangers emanating from the Gaza war and its expansion in the region, and the impact the destruction of Gaza will have on Arab generations.

On Wednesday, in Davos, Switzerland, Blinken said that it is up to Israel “to seize the opportunity that we believe exists,” and described the war as a “turning point” in the Middle East, requiring difficult decisions.