US secretary of state pushes two-state solution and criticises Netanyahu in toughest remarks on Israel by a US official in years. The US secretary of state, John Kerry, has offered a blistering defence of the US decision to allow a UN resolution condemning Israeli settlements, saying if Washington had vetoed it, Israel would have been given a licence for “unfettered settlement construction” and the end of the peace process.

Framing a two-state solution as “the only way to achieve a just and lasting peace between Israelis and Palestinians”, Kerry took aim at the Israeli prime minister, Benjamin Netanyahu, for building a coalition that was “the most rightwing in Israeli history, with an agenda driven by the most extreme elements”.

Kerry’s speech was the latest chapter in a high-octane diplomatic drama marked by a war of words between the Obama administration and Israel, since the vote on Friday that called Israeli settlements in the West Bank and east Jerusalem a “flagrant violation” of international law.

The speech was immediately condemned by Netanyahu, who described it as “skewed” and “obsessively” focused on the settlement issue.

The exchange between Kerry and Netanyahu marked a new low in the relationship between Israel’s government and the Obama administration.