The bitter exchange erupted last Sunday when the Pope deplored terrorist attacks in Egypt, Turkey, Iraq and Britain but made no mention of a 12 July suicide bombing that killed five Israelis at Netanya.
The Israeli Foreign Ministry demanded an explanation from the Vatican. And papal officials were outraged when a senior Israeli Foreign Ministry official, Nimrod Barkan, told The Jerusalem Post, in a fresh broadside against Rome, that "not condemning terrorism in Israel has been the Vatican's policy for years. Now that we have a new Pope we have decided to confront this question".
The Vatican has issued a strongly worded defence of Pope Benedict's original statement, using language described by Holy See observers as "blistering". The statement said Pope Benedict XVI omitted any mention of Israel and Palestine in the condemnation because Israel sometimes retaliated to attacks in ways "not always compatible with the rules of international law".
The full passage read: "The Holy See cannot take lessons or instructions from any other authority on the tone and content of its statements. It's not always possible to immediately follow every attack against Israel with a public statement of condemnation [because] the attacks against Israel sometimes were followed by immediate Israeli reactions not always compatible with the rules of international law. It would thus be impossible to condemn the first [Palestinian attacks] and let the second [Israeli retaliation] pass in silence."
Although Israel refused to give an immediate public response, one senior official said there was a "lot of anger" in Jerusalem and suggested the Vatican was "giving a legitimacy to terrorising the people of Israel". The senior Israeli source said the original anger had not been personally aimed at Pope Benedict but at the Vatican as a whole. He added: "This is the wrong criticism, at the wrong time, one at which we are about to pull nearly 10,000 Israelis out of Gaza." He said a further public condemnation would not be made in the hope that the Vatican would retract its criticisms.
But Vatican sources said official Israeli criticism of the late Pope John Paul, whose long pontificate was marked by his apology for the Church's historical anti-Semitism, rankled particularly with the German pope and his entourage.
"Even when recalling the inalienable rights of the Palestinian people, the pontiff [John Paul] repeatedly denounced clearly the inadmissibility of violent methods," the Vatican said. "Affirmations contrary to historical truth can only serve those wanting to foment animosity and differences.".
The Vatican spokesman, Joaquin Navarro-Valls, said Pope Benedict had been referring to the attacks of the past few days and, on the Foreign Ministry statement, that it was "surprising one would have wanted to take the opportunity to distort the intentions of the Holy Father". He said the Netanya attack, a week after the first London bombings, "falls under the general and unreserved condemnation of terrorism" by the pontiff.
Rome's chief rabbi, Riccardo Di Segni, said in an interview the dispute was "only damaging for both parties" and that he hoped it ended quickly, particularly before Pope Benedict XVI visits a synagogue in Cologne, Germany, next month.
Until recently, Israel frequently demolished the homes of suicide bombers, though it has announced a halt to that practice. After the two suicide bombings since the fragile ceasefire was called in February, Israel refrained from large-scale incursions into occupied territory, though a Palestinian policeman was killed after the Netanya bombing, when troops moved into Tulkarum to make at least five arrests of Islamic Jihad militants.
The election of Pope Benedict was widely and sympathetically covered in the Israeli media at the time, because he was expected to maintain the momentum of Christian-Jewish dialogue as well as good relations with Israel.