Israeli Prime Minister on Tuesday declared his country is willing to give up some settlement sites in the name of peace, but at the same time laid out demands that are seemingly unacceptable for the Palestines.

Natenyahu's speech before Israeli lawmakers immediately drew wild response and a standing ovation from those present when he declared that his government was ready for "painful compromises."

But the familiar conditions he set forth was quickly rejected by Palestine.

In his speech, Netanyahu said that while Israel is ready to give up some Jewish settlements in the occupied West Bank, Israel would be annexing others in the future.

"I am willing to make painful compromises to achieve this historical peace. Now this is not easy for me. It's not easy because I recognize that in a genuine peace we will be required to give up parts of the ancestral Jewish homeland." the prime minister said echoing his earlier pronouncement before the Israeli parliament on May 15 in which he hinted at a readiness for territorial compromise but with strings attached.

But his promise fell short of concrete concessions but instead set tough limits on What is deemed acceptable for Israle.

He undoubtedly got the full support of the Israeli parliament who rebuffed the Obama administration for what they think as pushing Israel too hard to reignite the moribound peace process in the Middle East.

Amongst the conditions set by Netanyahu is the recognition of Israel by Palestine as the homeland of the Jewish people and to abandon the Western-backed Palestinian President Mahmoud Abbas' unity accord with the Islamist movement Hamas.

Netanyahu added, "In any peace agreement that ends the conflict, some settlements will end up beyond Israel's borders. The precise delineation of those borders must be negotiated."

He said that any "compromise must reflect the dramatic demographic changes that have occurred," referring to Israel's construction of hundreds of settlements on land Palestinians want for a state.