Israel's prime minister has rejected international criticism of West Bank settlement construction, equating it to "ethnic cleansing" of Jews and insisting the settlements are not an obstacle to peace.

Israel has been widely criticized, including by its close ally the United States, for building settlements in territories captured in the 1967 Mideast war, land the Palestinians want as part of their future state.

Benjamin Netanyahu said in a video posted on social media Friday that he has "always been perplexed" by claims that Israeli settlement building is "an obstacle to peace."

Netanyahu says the "Palestinians leadership actually demands a Palestinian state with one precondition: No Jews."

Palestinians have accused Israel of ethnic cleansing during the 1948 war, when hundreds of thousands of Palestinians fled or were expelled in the fighting.