This week’s savage murder of four rabbis in their synagogue in Jerusalem has triggered a new round of hostility between these two ancient combatants.

The surge in violence is almost certain to get worse as there are few leaders on either side with the ability to speak to the other.

Israel’s swing to the right under Benjamin Netanyahu appears to have sealed the fate, for now, of a Palestinian state and the end of Israel’s 47-year occupation.

An opinion poll by the Jerusalem Centre for Public Affairs found 75 per cent of Israeli Jews oppose a two-state solution if the Palestinian entity is based on 1967 lines — the West Bank — and Israeli troops have to withdraw.

This reflects how Israelis have voted increasingly for candidates opposed to a Palestinian state.

An independent Palestine alongside Israel is the solution countries such as the US and Australia regard as the only chance to end the bloodshed since Israel was formed in 1948.

After Tuesday’s synagogue killings the thirst by some for revenge was clear. Within hours a gang of about 50 masked men left Yitzhar, home to some of the most violent settlers on the West Bank, and attacked Palestinians as soldiers standing near watched on.

Footage obtained by Israeli human rights group Yesh Din also shows the soldiers pointing their guns at Palestinians as settlers threw rocks at villagers. One settler fired towards the village.

Adding to the climate of revenge was the Ashkelon mayor Itamar Shimoni, who summarily fired Arab labourers working for the municipality. Mr Netanyahu called the sacking discriminatory but Housing Minister Uri Ariel endorsed it. “I suggest that everyone examine who is working for them,” Mr Uriel urged.

Most nights in Jerusalem clashes between Palestinian youths and Israeli security forces involving teargas and sometimes live ammunition can be heard.

Fear is seeping through neighbourhoods.

In East Jerusalem, a frightened mother sits in her apartment talking about how bad life has become.

“We won’t let our boy ride his bike outside. We’re worried that settlers who live five minutes away will try to kidnap him.”

The woman’s home is 2km from where 16-year-old Mohamed Abu Khdeir was kidnapped in June before having petrol poured on him and burnt alive. The day before men in a car tried to take a Palestinian boy off the streets but his parents fought them off. The man who led the Khdeir kidnapping told police: “They took three of ours (Jewish youths), let’s take one of theirs.”

A sports club for children in East Jerusalem now has guards in case of further kidnap attempts. Parents of Palestinian children at the French Lycee warn their children not to speak Arabic in public.

One Christian Palestinian executive, who works for the Catholic Church near the Old City, is now frightened to walk into the centre of Jerusalem “in case people realise I’m an Arab”.

On the Israeli side, the fear is just as palpable — in Haifa and Netanya parents want armed guards at kindergartens.

“The terror inspired by the massacre in the synagogue in Har Nof was patently evident not only in the streets of Jerusalem yesterday but across Israel,” Israel’s biggest-selling newspaper Yedioth Ahronoth reported.

“And the impression is that the public sense of security has been dealt a mortal blow.”

In June a tense situation intensified after the bodies of three Israeli teenagers, who had been kidnapped as they waited for buses, were found near Hebron.

Then, in payback, Mohamed Abu Khdeir was kidnapped.

This violence is filling the vacuum left when the peace talks mediated by US Secretary of State John Kerry collapsed five months ago. Many on the Right in Israel were delighted when Kerry threw up his hands and left.

They had made clear what they thought of him — Defence Minister Moshe Yaalon, a key figure behind Israel’s new surge in settlement growth, had branded Kerry “messianic” and “obsessive” in his effort to find peace.

“The only thing that can save us is for John Kerry to win a Nobel Prize and leave us in peace,” he said.

While there was no Nobel Prize, Yaalon has got what he wished — the US has clearly consigned this conflict to the too-hard basket.

Into that vacuum have charged key members of Mr Netanyahu’s Likud party — particularly Moshe Feiglin and Tzipi Hotovely — who have reignited a campaign for Jews to pray next to the Al-Aqsa mosque — a site in Jerusalem referred to by Jews as the Temple Mount. This has stirred up religious tensions which had been managed — most rabbis in Israel forbid Jews from praying at the Temple Mount to avoid violence.

Over the last week both sides have targeted a place of worship for the other — last week Jewish settlers set fire to a mosque and this week the two Palestinians rampaged in the synagogue.

While the new battle for Al-Aqsa is the immediate cause of the violence the longer-term cause is Israel’s continuing expansion of Jewish-only settlements in the West Bank, or Palestinian ­Territories.

Figures revealed in the Israeli media show the Netanyahu government is financing a massive growth in settlements — coinciding with the announcement of new settlement housing the day after the synagogue murders.

Figures for the 2015 budget show a rise of 240 per cent in Israel’s funding for the World Zionist Organisation’s settlement ­division.

The body was established to help remote Israeli communities in places like the Negev desert but in recent years much of the money has been diverted to the settlements, which are regarded as illegal under international law but which Israel says are legal.

Israeli Labor politician Stav Shaffir says this money is being diverted to settlements due to “an extortionist lobby of the extreme right wing”.

Israel’s settlements are clearly the main factor now fuelling the conflict: they are systematically eating up land which Palestinians say should be their state and are often being built on privately owned Palestinian land.

An Israeli data base prepared by the Defence Ministry showed that in more than 30 settlements extensive construction of buildings and infrastructure — roads, schools, synagogues, police stations and yeshivas — was on private Palestinian land.

Upon receiving the report, Israeli officials ordered that it be kept secret as it confirmed many of the allegations the international community had been making against Israel for years — that many of its settlements were built on stolen land.

But in 2009 someone leaked the data base to Haaretz: it showed that in about 75 per cent of settlements construction had been carried out illegally.

In addition to the settlements are more than 100 “outposts” — illegal under Israeli law but which Israel allows to grow.

In contrast, Palestinian villages in Area C — 60 per cent of the West Bank — must seek a permit from the Israeli army to build a new house or extra room, something rarely granted.

Anyone who drives across the West Bank today will see a skyline dominated by Jewish settlements.

Palestinians are not allowed to enter these gated communities — Israel has declared them “closed military zones” — and are not allowed to drive on many roads around them.

The skyline also features illegal outposts — these often begin with armed Jewish youths setting up a caravan on private Palestinian land and are then expanded into a larger community.

Any settler — even those in illegal outposts — who says they feel threatened will be provided with a gun, and training, by the Israeli army.

Many outposts are built by the “hilltop youth”, armed gangs which frequently roam the West Bank destroying olive trees owned by Palestinians or attacking Palestinians physically.

The outposts are a way settlements are growing “off the books” — they only become part of Israel’s official statistics when retrospectively legalised.

Amid the new violence, it seems there is only one chance to end this tragedy — an urgent political solution for a Palestinian state that would end Israel’s control over 2.5 million Palestinians in the West Bank.

The critics of such a two-state solution argue that this would not guarantee peace — and they may be right.

But what is guaranteed is that if the current course is continued there will be much more ­bloodshed.