RAMALLAH: Palestinian president Mahmud Abbas said on Thursday he will not seek re-election in January amid frustration with the US position on Israeli settlements, a senior PLO official said.

"President Abbas told the PLO executive committee that he will not run in the next presidential election, and the executive committee unanimously told him that they reject the decision," said Yasser Abed Rabbo.

The Palestine Liberation Organisation's top body "announced they will still support him as the nominee in the elections," which the Palestinian leader has called for January 24 alongside a parliamentary poll.

"President Abbas has said more than once that he does not want to be a candidate because of his feelings of great frustration about the American position on the peace process," senior Fatah official Nabil Shaath said.

He said Abbas's frustration also applied to the international community, "Arab and non-Arab," because of lack of progress on the Palestinians' demand for a halt to settlement building on the occupied West Bank.

"But the Fatah movement with all of its cadres and institutions stands behind president Abbas running for another term," Shaath told reporters.

Abbas's frustration was said to have peaked when US Secretary of State Hillary Clinton praised an Israeli proposal for some settlement limits as "unprecedented" after months of Washington demanding a full settlement freeze.

Clinton later clarified that US President Barack Obama's administration still considers settlements "illegitimate" but also called on the two sides to resume negotiations even without the freeze demanded by the Palestinians.

Shaath said Abbas felt he had done everything required of him under the internationally-adopted 2003 roadmap agreement, which called on the Palestinians to improve security, but had received nothing in return.

"The Americans have abandoned their obligations," Shaath said.

In 2007, Abbas launched a massive security crackdown in the West Bank led by US-trained Palestinian forces that has transformed many former militant strongholds and been praised by the United States and Israel.

The roadmap also calls on Israel to remove all outpost settlements erected after 2001 and to halt settlement activity, but thus far Israel has rebuffed US and international demands for a complete settlement freeze.

Nearly a half million Jewish settlers live in the West Bank, including east Jerusalem, territory captured by Israel in the 1967 Six-Day War and claimed by the Palestinians as part of their future state.

Abbas was elected president in 2005 following the death of the iconic Palestinian leader Yasser Arafat.

The Islamist Hamas movement, which drove Abbas's forces from the Gaza Strip in June 2007, no longer recognises him as president because his term officially ended in January 2009.

Last month, Abbas called for presidential and parliamentary elections to be held on January 24, a date set by the Palestinian constitution, but Hamas has rejected the elections as "unconstitutional" because of Abbas's status.