"This time it won't just be a condemnation, there will be real action taken against Israel," a senior European diplomat told Ha'aretz daily as Israel continued with punitive measures against the Palestinian Authority (PA) following their successful bid at the United Nations to win a non-member state observer status.
"Britain and France are poised to take action - possibly including the unprecedented step of recalling their ambassadors," the report said.
The Jewish state has decided to move settlement construction ahead in the area known as E1, between Ma'aleh Adumim and Jerusalem that may effectively break the territorial contiguity of a future Palestinian state with east Jerusalem as its capital, hampering future peace negotiations.
Israel's Prime Minister Benjamin Netanyahu's decision on Friday, a day after PA's successful bid at the UN, to move ahead with plans for E1 and to build 3,000 housing units in East Jerusalem and West Bank settlements has apparently "shocked" the foreign ministries and the leaders in London and Paris.
Not only do Britain and France view construction in E1 as a "red line", they are reportedly angry because they view Israel as having responded ungratefully to the support the two countries gave it during the recent Gaza operation.
"London is furious about the E1 decision," an unnamed European diplomat was quoted as saying by the daily.