WASHINGTON (AFP/Reuters) - Washington believes it is too early to talk about imposing sanctions on Israel to force it to freeze settlement building in east Jerusalem, a State Department spokesman said Tuesday. Its premature to talk about that, said spokesman Robert Wood when asked about the possibility of US financial sanctions. What we are trying to do, as I said right now, is to create an environment which makes it conducive for talks to go forward, he added. And you know, as I said, Senator Mitchell is working very hard on this. Israels Deputy Foreign Minister Danny Ayalon said the Jewish state was working and will continue to work in accordance with its vital national interests, especially with respect to Jerusalem. But Wood responded: Well, certainly no one is asking Israel to act outside its national security interests. What were asking both parties to do is to fulfil their road map obligations. Both sides have committed to do that. Meanwhile, Israeli Prime Minister Benjamin Netanyahu rejected on Wednesday any notion he would order Israels barrier in the West Bank to be torn down in response to the absence of Palestinian attacks from the occupied territory. The separation fence will remain in place and will not be dismantled, Netanyahu said in a speech in parliament in Jerusalem. I hear they are saying today that because its quiet, its possible to take down the fence. My friends, the opposite is true, he said. Its quiet because a fence exists. Netanyahu made the comments after Israels Maariv newspaper said Palestinian officials had pressed Washington to push for the barrier to be dismantled because of an improved security situation in the West Bank. Palestinian chief negotiator Saeb Erekat told Reuters he had approached the US on the issue. The Israelis know that the wall adds to the complexities. Its part of the problem and not part of the solution, he said. In his speech, Netanyahu said Israel welcomed a certain improvement in the functioning of Palestinian security forces in the West Bank. But he added: The fence is important. Meanwhile, Israels ultra-nationalist Foreign Minister Avigdor Lieberman has ordered embassies abroad to use a photo of Adolf Hitler meeting a top Palestinian cleric to counter international criticism over a Jerusalem settlement project, a senior Israeli official said on Wednesday. The decision to circulate a 1941 photo featuring the Nazi dictator sitting with the then grand mufti of Jerusalem Amin al-Husseini is aimed at easing pressure on Israel over a construction project on land in annexed east Jerusalem once owned by the cleric, the official told AFP. The foreign minister ordered the distribution of the photo to all embassies abroad as a response to the Shepherd Hotel incident in order to prove a well-known point that the mufti collaborated with Hitler, the official said on condition of anonymity. Foreign ministry staff opposed the move, he added, one of the latest in a series of disagreements they have had with their firebrand boss since he was sworn in on March 31.