Ammon News - (AFP) Israeli and Palestinian negotiators meeting US envoy Martin Indyk to try to find a way to extend faltering peace talks have failed to reach agreement, a Palestinian source told AFP.

The meeting began in the late afternoon on Thursday in a Jerusalem hotel but ended after five hours of "very difficult discussions", the source said.

"The gap (between the parties) is still wide. There was no breakthrough," added the Palestinian source.

Indyk is now expected to meet negotiators again on Friday, but he will talk to the Israeli and Palestinian sides separately.

Israeli and Palestinian negotiators had met on their own on Sunday and held a three-way meeting with Indyk a week ago in last-ditch efforts to save the stagnant peace process launched by US Secretary of State John Kerry in July for a period of nine months.

State Department spokeswoman Jennifer Psaki said this week that Israeli and Palestinian negotiators are striving to reach an agreement to extend the talks beyond their April 29 deadline.

Washington is pushing for an extension but the negotiations hit an impasse two weeks ago when Israel refused to release a group of Palestinian prisoners as agreed at last year's launch of the talks.

Under the agreement, Israel had committed to freeing 104 prisoners held since before the 1993 Oslo autonomy accords in four groups, but it cancelled the release of the last group of 26.

Among them are 14 Palestinian-Israelis which Israel is refusing to set free.

Prisoners Day rallies

The PLO responded by seeking accession to several international treaties.

Thursday's new round of talks came as Palestinians marked Prisoners Day with rallies across the West Bank and Gaza Strip in solidarity with thousands of their jailed compatriots.

PLOr Saeb Erakat added his voice to the protesters on Thursday by calling anew on Israel to free the last batch of prisoners.

And prisoners minister Issa Qaraqe said on Voice of Palestine Radio that signing up to international treaties, including the Fourth Geneva Convention, could pave the way to prisoners' rights.

Despite the crisis, President Mahmoud Abbas's spokesman Nabil Abu Rudeina stressed the talks could be extended if Israel released the last batch of prisoners.

"What's needed now is Israel's commitment on issues that could lead to an extension of talks. If they commit, we're ready," he said on Wednesday.

And Abbas told Israeli opposition MKs visiting him in the West Bank administrative center of Ramallah he would insist that the 14 Palestinian-Israelis were among those released, Haaretz newspaper reported.

It said that if talks were extended, Abbas would want the first three months to be "devoted to a serious discussion of borders".

Israel's government has announced the construction of thousands of settler housing units and its army has killed over 60 Palestinians in the West Bank and Gaza since the negotiations began.