Attempts to broker a deal have been, at best, on a life support machine for nearly two years since Israel broke ground on a new settlement in East Jerusalem. But the US clearly believes that there is now a chance of injecting some life, and emphasising President Bill Clinton's continuing role in foreign policy in the process.
It will also be anxious to head off a looming clash over Palestinian statehood.
The Israel Prime Minister has been invited to come to Washington on Monday, and Mr Arafat, the Palestinian President, later in the week.
It is not intended that they hold a three-way meeting, the White House said, though the possibility was not excluded.
Mr Clinton called Mr Arafat and Mr Netanyahu yesterday to encourage them to accept a US proposal that would involve a partial Israeli withdrawal from the occupied West Bank, and in return, security assistance from the Palestinians.
The last time that the two men were in Washington was in January, but there has been no progress on the implementation of the Oslo Peace Accords since March 1997.
Washington is pressing both sides to accept a partial deal, but Israel is resisting, claiming that a withdrawal would undermine its security, while Palestinian officials want the Oslo Accords to be carried out as they were originally agreed.
After a deal, the two sides could proceed to Final Status talks, which could create a Palestinian state.
Mr Arafat will address the United Nations General Assembly on Monday, and is expected to seek support for a Palestinian state. He has warned that if Israel does not accelerate progress on a peace deal, then he will unilaterally declare a Palestinian state next May, the deadline laid down by the Oslo Accords.
Mr Netanyahu, in his address to the UN yesterday, warned that such a move would completely destroy the process.
"An arbitrary, unilateral declaration of a Palestinian state... would constitute a fundamental violation of the Oslo Accords," he said.
"It would cause the collapse of the peace process."
If Mr Arafat visits Washington for international talks, he will be leaving behind a domestic disagreement with hismother-in-law.
Raymonda Taweel threatened to leave the Palestinian-ruled West Bank for Paris yesterday after a dispute with the Palestinian leader over the right of the Arabic media to criticise his ministers.
The quarrel erupted earlier this month after Mrs Taweel fiercely criticised the Palestinian Finance Minister, Mohammed Nashashibi, in al-Awda, a magazine she edits.
Mr Nashashibi had withheld a subsidy, worth about pounds 10,000 a month, from the magazine.
According to Mrs Taweel, the minister's daughter telephoned her at 3am, leaving a message on her answering machine promising to teach her a lesson she would not forget.
Mrs Taweel took the tape to Mr Arafat and demanded that he call his minister to order. Instead, he accused her of declaring war on his ministers.
"He's my minister," she quotes him as saying, "and I'm defending him."
Mrs Taweel replied that she was entitled to write whatever she wanted. Mr Arafat, she said, shouted: "I can prevent you writing about my ministers."Reuse content