US Secretary of State John Kerry warned Wednesday that the "settler agenda" was leading Israeli policy in the West Bank and imperiling peace with the Palestinians.

"No one thinking seriously about peace can ignore the reality of the threat settlements pose to peace," Kerry said in a major speech on Middle East peace efforts.

"But the problem goes well beyond just settlements. Trends indicate a comprehensive effort to take West Bank land for Israel and prevent any Palestinian development there."

Kerry added: "The settler agenda is defining the future in Israel. And their stated purpose is clear: They believe in one state: greater Israel."