Unification of the Palestine is essential before any further steps can be taken to bring Tel Aviv and Hamas to the round table.
Diplomats in Kuala Lumpur said, there are three essentials for progress. Firstly, an Israeli government, elected in February's general election, that is committed to new negotiations on the creation of a Palestinian state.
Secondly, there is an obvious urgent need for meaningful Palestinian unity between Fatah and Hamas. The current split not only weakens the Palestinian voice but also makes it impossible for negotiations to deliver a comprehensive peace.
Thirdly, the United States remains the only power able to provide the security guarantees that will be needed to underpin any settlement.
Barack Obama's presidency, with no White House elections due for four years, offers an unprecedented opportunity for a major initiative that would put real pressure on Israelis and Palestinians.
The tragedy in Gaza may, inadvertently, help on delivering each of these requirements. The conflict has boosted the popularity of the Israeli government at the expense of opposition leader, Binyamin Netanyahu, who is resolutely against a Palestinian state.
While Palestinians might, understandably, see all Israeli politicians as bellicose Zionists, reality is that Tzipi Livni and Ehud Barak have concluded that a Palestinian state and withdrawal from most of the West Bank is in Israel's interests as well as that of the Palestinians.
A ceasefire in Gaza that prevents missiles from being smuggled into the territory in future and the substantial damage that has been done to Hamas's infrastructure may be sufficient to justify the conflict in Israeli eyes and secure Livni and Barak electoral victory.
The past few weeks has also demonstrated the disunity of the Palestinians caused by the Fatah-Hamas split. The Egyptian, Saudi and Jordanian governments loathe Hamas.
The conflict has distracted attention from the Saudi peace plan of King Abdullah. It offers a comprehensive peace in the region and has attracted favourable comment from Israeli President Shimon Peres and other leaders in Jerusalem.
While many might assume that Israel favours Palestinian disunity on the principle of ‘divide and rule’, the reality is that it has been a disaster from the point of view of anyone who wants a negotiated peace leading to a Palestinian state. Hamas continuing to rule in Gaza would mean a three-state problem, not a two-state solution.
The Obama presidency, combined with Hillary Clinton as secretary of state, offers an extraordinary opportunity for real progress.
Although Obama will be well disposed towards Israel, because of his personal beliefs and political necessity, we are likely to see, for the first time for many years, an American president prepared to put real pressure on the Israelis to concede a Palestinian state with territorial integrity and economic viability.
A former top ranking official of Fatah, Marwan Barghouthi (picture) said yesterday now is the time for complete national reconciliation. "This is for the sake of the blood of those killed,” he said from an Israeli jail. "We have no time to waste in the restoration of the homeland, the people and the authority," he stressed.
Meanwhile, a high-ranking Palestine Liberation Organisation (PLO) official has voiced a similar tone calling for an urgent meeting among rival Palestinian factions to discuss the situation in Gaza.
The Secretary of the Executive Committee of the PLO, Yasser Abed Rabbo, said that Palestinians must unite and overcome their internal conflicts, and that Hamas and Islamic Jihad should be also included in PLO meetings, although they are not members of the PLO.