Palestinian Authority President Mahmoud Abbas is reaching out to rival Hamas in a renewed bid for unity after his campaign for United Nations membership failed in the Security Council last week.

Mr. Abbas is reportedly pushing to set a May 2012 date for Palestinian elections – the first such vote in five years – and will bow to Hamas demands for the resignation of Prime Minister Salam Fayyad so an interim unity cabinet can be appointed.

The fresh effort at reconciliation highlights an apparent contradiction. Israel considers Abbas's potential cooperation with Hamas as collusion with a sworn enemy, but many observers believe a peace deal would be impossible to implement so long as Hamas and Fatah remain estranged, one controlling Gaza Strip and the other the West Bank.

"We have an opportunity here," says Akiva Eldar, a columnist for the liberal newspaper Haaretz, who adds that Hamas wouldn't necessarily block Abbas from engaging in peace talks after they formed a unity government. "What Hamas is saying is that Abbas, the PLO, has a full mandate to cut a deal with Israel. They are betting that Israel will do the job for them, by saying no."

Mr. Eldar also says that Israeli Prime Minister Benjamin Netanyahu won’t come under pressure from the US to negotiate with an Abbas-Hamas unity government before America's 2012 elections, because the largely pro-Israel Congress opposes any dealings with Hamas, which is designated a terrorist organization by the US, Israel, and the European Union.

Hamas-Fatah meeting next week
Hamas and Abbas's Fatah party had formed a unity government in 2006, after Hamas won elections that year. But they split in 2007, when Fatah was violently ousted from the Gaza Strip. Since then, Hamas has ruled Gaza, while the Fatah-dominated Palestinian Authority has run the West Bank.

Anticipation of a breakthrough on the Fatah-Hamas impasse has been stoked in part by a scheduled meeting between the president and Hamas leader Khaled Meshaal in Cairo next week. The two haven’t met since last May, when Fatah signed a unity deal with Hamas.

At the time of the May announcement, Netanyahu said that Abbas must choose between peace with Hamas and peace with Israel. But Abbas has pointed to Israeli settlement construction in the West Bank and Jerusalem as evidence that the current Israeli government isn’t interested creating a viable Palestinian state.

"Is there peace offer by Israel?" says Ghassan Khatib, a spokesman for Fayyad's government in Ramallah. "I didn’t notice."

Fayyad, darling of the West, likely to step down
Abbas emerged weaker after the Palestinians failed to muster a majority at the Security Council in favor of full membership. A Security Council committee that reviewed the Palestinian application specifically mentioned the four-year divide between the West Bank and Gaza as a problem.

In an address on Wednesday, Abbas vowed to accelerate reconciliation with Hamas. A unity deal would help the Palestinian president recover some of the lost prestige. But the Islamist militant group is in a stronger position after a prisoner swap with Israel that freed hundreds of Palestinians.

The original reconciliation deal called for a unity cabinet and elections within a year, however the sides never agreed on a cabinet. Hamas, which refuses to recognize Israel, has demanded that Prime Minister Salam Fayyad, a darling of the West for his reputation as being tough on corruption, step down.

Still that task of unity will be difficult because Abbas will not have much room for maneuvering between Hamas and the US, says a Palestinian official who asked to remain anonymous. "The more flexibility he shows to Hamas, the more difficulties he will have with the outside world and with Israel."