Israel's invasion of Gaza seemed depressingly far from an endgame last night, despite the encouraging signs from the UN Security Council. Although the Security Council produced a ceasefire resolution, it was fatally undermined by the American abstention. And there are now reports that the Egyptian initiative with Hamas might be running into the ground.

The smoke of combat will eventually clear. But when it does, what is the way forward? Can anything positive emerge from the bloodshed of the past fortnight?

A good deal of nonsense has been spoken this past week regarding Israel's military operation. The most egregious contribution has come from a senior Catholic cardinal, who has compared the Gaza Strip to a "concentration camp". The comparison is entirely spurious. And considering the Vatican's own dubious record in the Nazi era, it represents the grossest hypocrisy.

Moreover, the idea being pushed by some propagandists in the West that the Israeli state is deliberately setting out to kill innocent Palestinians is just as offensive and wrong. The Israel administration's priority in this operation is to defend its citizens from rocket attacks by Hamas.But while the Israeli state might have succeeded in degrading Hamas' military capabilities in the past two weeks, it cannot plausibly argue that Operation Cast Lead has helped to bring a two-state solution for Israelis and Palestinians any closer. And such a settlement is, ultimately, the only way to deliver the true and lasting security that both peoples deserve.

The infuriating aspect of the present violence in the Middle East is that there exists broad agreement between mainstream Israeli and Palestinian society on the parameters for an enduring peace deal. This deal would entail Israel withdrawing to its pre-1967 frontiers, the dismantling of settlements, arrangements on sharing Jerusalem as a capital and compensation for those Palestinians who lost their land in 1948. There will be much haggling over the detail, but the destination has widespread acceptance and regional support.

And yet it remains no closer. Why? The answer takes us back to Gaza. One of the biggest obstacles to progress has been the rancorous enmity between the Hamas and Fatah Palestinian factions. Since Hamas won the parliamentary elections in 2006 and took control of the Gaza Strip the next year, the Palestinian people have had a divided leadership. This has delegitimised the negotiations between Israel and Fatah. The spectre of Hamas has overshadowed everything.

The recent suggestion that Barack Obama is preparing to open covert channels of communication with Hamas when he enters the White House has been denied by the Obama camp. But if it turns out that Mr Obama is willing to engage with Hamas and put pressure on Israel to do the same, prospects of serious negotiations on a two-state settlement suddenly seem to move significantly closer.

Talking to Hamas does not mean supporting the group's fanatical creed, condoning its terrorist methods, or accepting its territorial demands. Nor does it mean asking Israel to sit idle while Hamas fires rockets into Israeli territory or smuggles arms across the Egyptian border. Some form of dialogue – with European and Arab involvement – would be a practical move to build trust and open the way for concessions and peacemaking from both sides. It is in the best interests of the Israeli and Palestinian people.