JERUSALEM — Israelis and Palestinians are closely watching next month's U.S. midterm race amid a sense — rarely discussed openly but very much on people's minds — that the result could affect the U.S.-led peace effort, and President Obama's ability to coax concessions from Israel.

Animating the discussion is the startling fact that the United States has failed, despite emphatic public appeals by Obama and weeks of increasingly frustrating diplomacy, to persuade Israel to extend the settlement-building slowdown that expired on Sept. 26.

That caused Palestinians to in effect suspend the U.S.-brokered peace talks just weeks after they began.

The Palestinians are now hoping that Obama has reacted mildly to Israel's rejection because of political considerations ahead of the Nov. 2 vote — and might be freer to apply pressure after the elections.

"We think that if President Obama emerges strong from this election, then this will enable him to work more on foreign policy," Palestinian negotiator Nabil Shaath told The Associated Press. "If he and his party lose in the elections, then this will limit his ability to pressure and actively engage in foreign policy. This is the problem."

Although Israeli officials avoid discussing the topic publicly for fear of alienating the Jewish state's most important ally, there is a foreboding sense in Israel that punishment is on the way — especially if Obama emerges unscathed.

Nahum Barnea, a respected and widely-read columnist, put it this way in Friday's Yediot Ahronot: "The problem is the disgust and rage that the Israeli refusal sparked in the administration — a rage that is being suppressed at the moment, but which will erupt in full force on November 3, after the elections to Congress. The Americans are seeking the logic behind the refusal ... and are finding nothing."

But if recent polls are borne out and Republicans take one or both houses of Congress, a chastened president might be too busy or weakened to pressure Jerusalem much, the thinking goes.

If Congress tilts Republican it could have a "positive impact" on Israeli concerns, one Netanyahu adviser told The AP — an allusion to avoiding pressure for concessions. With the Democrats weakened, Israel's friends in Congress — both Democrat and Republican — "would be able to have a stronger voice if the administration should embark on a policy that is less favorable to Israel," he added.

U.S. foreign policy is set by the White House, not Congress. But Congress can influence it in the course of the day-to-day political horse trading that goes on between the executive and legislative branches.

For example, when Republicans controlled the House of Representatives during Netanyahu's first term in the late 1990s, the Israeli leader was able to marshal the support of the party's conservative wing in a faceoff with President Bill Clinton over stepped-up settlement construction and Israeli troop pullbacks in the West Bank.

Traditionally, both branches have been bastions of support for Israel no matter which party is in charge. But conservative Republican legislators tend to be less critical of Israel's contentious settlement policy and more hawkish — and therefore supportive — on the security issues that are uppermost in Israel's mind.

The Israeli government has had, at best, uneasy relations with Obama himself.

Obama took office in early 2009 promising bold changes in American policy in the Middle East and in one of his first official acts appointed a Mideast peace envoy.

He soon traveled to Egypt, the heart of the Arab world, in a high-profile gesture to Muslims. The speech included a condemnation of Israeli settlements, winning over Palestinians while alarming the Israeli government.

Tensions peaked in March over Israel's approval of a major settlement construction plan in east Jerusalem during a visit by Vice President Joe Biden. The move infuriated Biden, and Obama later publicly snubbed Netanyahu during a White House meeting. Although relations have mended, Mideast peace talks launched by Obama in early September are at an impasse over renewed settlement construction.

In the United States, foreign policy has barely registered on the radar screen in the run-up to the election. Blamed by many for the still-struggling economy and unemployment hovering around 10 percent, the Democrats find their majority at risk, especially in the House of Representatives, where all 435 seats are on the ballot.