Tom Friedman says Palestinian economic growth in the West Bank is changing everything. Pres. Obama and the Saudi King discuss the peace process. A Hamas member who spied for Israel begs not to be deported from the United States. Under much criticism, Israel may extend the remit of the Gaza flotilla investigation. Pres. Abbas urges stronger efforts on peace. Disabled activists fight for rights in Gaza. A new poll shows Palestinians and Israelis are hopeful but cautious about peace. Projectiles fired from Gaza strike southern Israel. Bradley Burston says Israel has been taken over by tea party-like fanatics. Settlers announce an “aggressive campaign” against PM Netanyahu. The Hamas-Fatah divide is proving unbridgeable. A proposed Israeli law would outlaw all forms of boycott, including against settlement goods. DM Barak is acting more as Israel's Foreign Minister than FM Lieberman. PM Hariri calls for more rights for Palestinians in Lebanon, and Rami Khouri says the situation is shameful. Yossi Alpher says the Gaza blockade has been counterproductive.

Richard Cohen says Hamas is hurting the Palestinian cause. An Israeli court sentences a Palestinian to life in prison. 10 Jordan Valley families are given 24 hours before their homes will be demolished. Palestinian officials seek to build ties with Jewish American leaders. Palestinians say progress on security, borders and settlements are key to direct negotiations. Israeli shelling kills a Palestinian in eastern Gaza. Palestinians launch a shop-two-shop settlement goods boycott campaign. FM Lieberman says there is no chance for a Palestinian state before 2012. The US is reportedly frustrated with Israel's positions at proximity talks. Ha'aretz says the power plant issue shows Hamas does not have Gazan's best interests at heart. The Jerusalem Post profiles the head of the so-called “Islamic movement” in Israel. The Independent profiles a Palestinian man struggling to retain his Jerusalem residency. Emile Hokayem says Lebanon mistreats Palestinian refugees. PLO officials say disbanding the PA is a possibility. Ghassan Khatib and Omar Shaban both say the siege of Gaza must be lifted completely.

The family of captured Israeli soldier Gilad Shalit campaigns for his release. The New York Times interviews Israeli opposition leader Tzipi Livni. Israeli Amb. Oren says that he did speak of a tectonic shift in US Israel relations, but not a “rift.” Palestinian feminists say women's rights are being eroded by Hamas rule in Gaza, and human rights agencies warn of a generalized assault on civil liberties. Pres. Abbas says Palestinians are waiting for diplomatic answers. Gaza banks are closing following another daylight raid by Hamas gunmen. Palestinian extremists again attack a UN summer camp in Gaza. Israel's official inquiry into the flotilla attack begins, but The Arab News says it has something to hide. Palestinian women in the West Bank take up motor racing. Turkey closes its airspace to Israel. An Israeli committee is considering major settlement expansion in Arab areas of occupied East Jerusalem, and construction has reportedly begun in Sheikh Jarrah. Akiva Eldar says Israel refuses to recognize the importance of the Arab Peace Initiative. The UN says squabbling between Hamas and the PA led to the shutdown of Gaza's only power plant. Seth Freeman looks at the difficulties of Palestinians traveling in Israel. Palestinian refugees rally for their rights in Lebanon. The National says Israel must recognize peace requires actual compromises. Diana Mukkaled says the politics of the flotillas are often not what they appear.

Pres. Peres says the US should engage Hamas on peace. Israel bombs 4 sites in Gaza. Israel offers to let EU officials visit Gaza. On the fourth anniversary of the capture of Gilad Shalit, rights groups criticize Hamas' treatment of Israeli prisoners. Israeli soldiers often kill Palestinians with impunity. Aluf Benn describes the four stages of US-Israel policy disputes. Yitzhak Laor says the spirit of Kahane is alive in Israel's universities. Gideon Levy asks when the Israelis will hold PM Netanyahu to account for his policies. Israelis accuse Palestinians of “stealing” water in the occupied West Bank. Israel plans to increase trucks into Gaza by 200%. Ray Hanania praises the first planned Palestinian city in the West Bank. Antony Lerman says a lively debate has emerged about the nature of Israeli society. The Economist says Hamas is gaining ground following the flotilla debacle, and the US calls further flotillas irresponsible. Patrick Seale says that, alarmed by regional developments, Israel may be reconsidering peace with Syria.

Israeli occupation authorities authorize the demolition of 22 Palestinian homes in East Jerusalem. Pres. Abbas says such measures threaten peace. The UN calls the plan illegal and urges Israel to reconsider. The body of a Palestinian shot by Israeli soldiers is being exhumed for an autopsy. Israel will reopen the investigation into the shooting of an American protester. Abbas condemns Israeli plans to expel 4 Hamas politicians from Jerusalem. Fear of being expelled to Gaza keeps West Bank Palestinians in their homes. Hamas TV will no longer be shown in France. European MPs call for the complete lifting of the Gaza blockade. Malaysia is pressing for a wider international investigation into the flotilla attack. FM Lieberman outlines his vision of “peace,” which includes stripping citizenship from some Arabs. Israel launches a major new spy satellite. Ahmed Moor looks at how Palestinians in Lebanon are treated as second-class citizens. Michael Jansen warns there may be another Middle East war.

Israeli decision to demolish Palestinian homes in East Jerusalem draws criticism internationally and from Israeli Defense Minister Barak. Israeli settlers threaten to forcibly evict Palestinians in Jerusalem and attack Palestinians near Bethlehem. Ahead of his upcoming Washington visit, Israeli Prime Minister Netanyahu blames Palestinians for lack of progress in negotiations while his National Security Advisor questions the United States Middle East and Iran policies. Israel asks UN to shelve aid ship raid inquiry, as Balkan summit condemns raid and a Lebanese ship prepares to leave Gaza. Two articles in Bitter Lemons discuss the merits and risks of Israeli settlers remaining in a future Palestinian state.

ATFP President Dr. Ziad Asali calls for a broad national alliance in support of a two-state solution. Israeli plan to raze 22 Palestinian homes in Jerusalem is criticized by the US, defended by Jerusalem Mayor. Ghassan Khatib argues that continued settlement activity will only make it difficult find creative solutions. Editorial in The New York Times contends that Netanyahu was right in his decision to ease the Gaza blockade. Quartet maintains that the situation in Gaza is ‘unsustainable’ and ‘unacceptable’ as the international community waits to see the extent of change on the ground. PA security forces detain two top Hamas affiliates in the West Bank on Monday night. Israeli military appeals court orders the evacuation of settlers from Palestinian-own land. A Haaretz editorial outlines disparity of rights of Arab citizens of Jerusalem versus Israeli citizens. Gershon Baskin: The proximity talks must include serious discussions on the core issues – borders, security, Jerusalem and refugees.

The US Administration and the Quartet welcome Israel's decision to ease the blockade of Gaza and Palestinian President Abbas calls for a full lifting of the siege. Prime Minister Netanyahu defends the decision domestically, as ships are set to leave from Lebanon and Iran. Ze'ev Segal examines the mandate of the committee appointed by the Israeli government to investigate the flotilla raid. President Obama is set to meet PM Netanyahu in Washington on July 6 amid reported plans to demolish Palestinian homes and build new settlement units in Jerusalem. The Jerusalem Post examines tensions between Hamas and Fatah while Ma’an News Agency report on an upcoming meeting between Hamas, Hizbullah and Iran in Damascus. Khairallah Khairallah examines how the Arabs' illusive search for the ideal hero leaves them vulnerable to external manipulation.

ATFP President Ziad Asali analyzes the Palestine Investment Conference. The CSM asks what drives PM Netanyahu and says Israel's easing of the Gaza blockade shows that progress is possible. Palestinians are divided on the blockade easing. Ha'aretz says it is a victory for the activists, but that the decision was not announced in Hebrew. Experts say it's not a lasting solution. The National calls it a ploy. Peace Now says settlers are still building in spite of the moratorium. Special Envoy Mitchell holds talks with Pres. Abbas, and urges restraint in a meeting with DM Barak. Ha'aretz profiles Israel's inner cabinet. The Palestinian cause finds strong support in Ireland. The World Zionist Congress votes in favor of a two-state solution and a settlement freeze. Rami Khouri says Pres. Obama is facing a test of his credibility. Dominique Moisi says Israeli political reform is essential.

Hussein Ibish says Palestinians are quietly building their state. Israel plans to ease the land blockade of Gaza. Hamas calls it a "trick" and the PLO "insufficient." In July, Presbyterians will vote on a report that condemns Israeli policies in the occupied territories. The UN says last year Israel removed 20% of West Bank checkpoints. US lawmakers harshly criticize Turkey, seek terrorism status for flotilla group. Pres. Abbas says the US and Palestinian positions on peace are virtually identical. Fatah says completely lifting the siege is linked to national reconciliation. Israel prevented a prominent Palestinian journalist from accompanying Abbas on his recent US trip. Ari Shavit says PM Netanyahu and DM Barak need to take urgent steps. Turkey may downgrade relations with Israel. Syrian Pres. Assad says a war is now likely. Larry Derfner says Israel should help PA statebuilding. Official Canadian support for Israel is growing. Arab states are urged to meet aid commitments to the Palestinians. Osman Mirghani says Jews should help Israel develop sounder policies. Michael Jansen calls Israel's flotilla commission a sham.