Appearing before a meeting of the Knesset State Control Committee on the Foreign Ministry and Israel’s public diplomacy last week, Prime Minister Benjamin Netanyahu claimed that Israel's international standing is on an upward trajectory. For understandable reasons the Prime Minister may have been somewhat embellishing his track record, but his claims should not be too quickly dismissed or belittled.

In just the last few weeks, Netanyahu can list an impressive trip to Africa, the Egyptian Foreign Minister visiting Jerusalem alongside that country’s efforts to renew peace talks on Israel’s terms, a renewal of ties with Turkey and hosting an unofficial Saudi delegation. In actual fact, the lead visiting Saudi, General Anwar Eshki, is a marginal figure in the Kingdom, but the discrete official channels that have been established and upgraded with Saudi Arabia, often also with and involving the United Arab Emirates, are both real and significant.

Netanyahu has notched up some genuine achievements in upgrading Israel’s regional relations. In the case of the Saudi delegation, Israel’s opposition, rather characteristically, cast itself in the role of Netanyahu's useful idiots, serving to provide some political cover for what was in essence a pro-Bibi visit. The Hadash party was correct in criticizing the visit and exposing its underlying message of peace without the Palestinians, but more on that shortly.

Previous peace efforts, including recent U.S. led initiatives under Secretary Kerry and former special envoy George Mitchell, have been punctuated by attempts to create incentives for Israel, by dangling the prospect of normalization with the Arab world. That equation failed to budge successive governments – largely because it under-appreciated the depth of Israeli rejectionism and ignored the need to also bring disincentives into the mix.

Netanyahu, Lieberman and others in the current government have argued that their approach is to improve this formula by turning it on its head. Israel will be more confident and strengthened in its ability to advance peace with the Palestinians if it already has the reassurance and guarantees that come with enhanced ties to key Arab states.

The problem with the Netanyahu formula is its fundamentally dishonest and specious character. Netanyahu has no intention of pursuing genuine de-occupation, Palestinian enfranchisement and peace under any circumstances. In reality he is attempting to prove something quite different – namely that Israel can manage and upgrade its regional relations while at the same time pursuing an ever-more aggressive and egregious set of policies towards the Palestinians. Netanyahu is still in the process of testing how far this proposition can be taken. He must find the results so far rather encouraging.

Much has been made of the interests of Israel and certain Sunni Arab states coalescing around opposition to Iran's role in the region. That is certainly the perception among leading decision makers. A more strategic reading would acknowledge that escalating conflict with Iran serves mostly to further radicalize and destabilize the region and that de-escalation of tensions would better serve all parties’ interests.

But even were that shift to occur, which is currently unlikely, Israel and key Arab states would still have legitimate and meaningful reasons to co-operate, from the shared threat posed by extremist Salafi–jihadi groups and mutual intelligence/security equities, to leveraging their respective relations with the U.S. and others, through to sharing approaches to managing global public goods.

However, just as Netanyahu is exploring how far he can go with his “more for less” approach (more relations with Arab states in exchange for less deliverables to the Palestinians), so, likewise the relevant Arab states are themselves navigating the contours of this new terrain.

On the one hand there is the desire among certain Arab states to collaborate with Israel and to not let Palestinian considerations over-burden that collaboration.

Nevertheless, there is another hand, and the Netanyahu formula of “more for less” (perhaps it is really ‘more for nothing’) is going to bump up against the limits of just how far Arab states can go without attaching conditions.

This is the Achilles heel of the current Israeli strategy. The first limit is that the ideological extremism that drives so much of the politics of Netanyahu's own Likud party and coalition allies could up-end regional outreach advances over any number of issues, from practices on the Temple Mount, to initiatives to annex part of the occupied territories; from incitement against the Palestinian minority in Israel to ongoing settlement provocations.

The second limit is that the same Israeli right-wing political realities may make it impossible to deliver even cosmetic improvements for the Palestinians, ones that Netanyahu would be comfortable with and that do not interrupt the overall occupation matrix of control in the territories. It is precisely these policies of cosmetic change that were under discussion and remain so during talks with the Labour party on joining the coalition to advance so-called "regional peace."

The third and arguably most game-changing limitation of Netanyahu's more for less gambit is the potentially re-invigorated leverage it affords the Palestinian leadership should they position themselves in such a way that that leverage can be deployed. For now, the Palestinian leadership has been insufficiently bold and strategic to undermine the “more for less” formula, to embarrass, cajole, and force a more robust Arab pushback against Israeli policies. The more embedded Israeli footsie with the Arab states becomes, the more exposed Israel is to a Palestinian jujitsu move.

Current trends suggest Netanyahu should have little to worry about on this score: The Palestinians are at a moment of heightened vulnerability, their leadership appears irredeemably disempowered, divided, and unable to mobilize its own public, let alone regional actors. At the same time the Arab world shows signs of moving on, abandoning even lip service to the Palestinian cause. That is the theory on which Netanyahu is banking, that as he pushes the envelop of regional normalization he will meet ever-decreasing resistance.

Yet, speaking to leaders across the region one hears a slightly different story. Yes, certain Arab states openly express a desire, even a perceived need to open a new page with Israel. But they are also working on the assumption that beyond the bluff and bluster, Israel’s leadership is a rational one, cognizant that there is a bottom line to the quid pro quo of normalization, and that Israel would be willing to make significant moves to satisfy legitimate Palestinian aspirations. And this is precisely where nasty surprises and disappointments await.

Just as Netanyahu’s capacity to fool American and European leaders with unfulfilled hints of moderation has not been open-ended, so too will this logic take hold in his flirtation with Arab leaders. They too have domestic constituency, politics and often influential and deeply suspicious clerical establishments. Palestine may have slipped down the list of priorities but it has not disappeared as a grievance, exemplifier of injustice or source of wounded Arab dignity in the region. And no leader, whether Western, Arab or neither of the above, likes to be taken for a sucker by Bibi.

While Netanyahu will not change his spots, the big ‘if’ in this equation is whether the Palestinians can translate the inevitable coming Arab frustration into practical gains.

The distilled essence of Israel’s policy towards the Palestinians is to guarantee continued impunity and to avoid costs and consequences. The Arab states, if effectively nudged by a new Palestinian strategy and especially once exposed by their newly enhanced ties to Israel, are well placed to challenge Netanyahu's preferred formula with some disincentives of their own - not only insisting on more for more but also imposing genuine costs if Israel maintains its rejectionist path.

Read this article on Haaretz.