French President Nicolas Sarkozy is outraged at Israeli Prime Minister Benjamin Netanyahu for withdrawing his participation in a Paris summit with Palestinian President Mahmoud Abbas, Ha'aretz daily reported Sunday.

The two leaders held a telephone conversation 10 days ago, during which Sarkouzy had asked Netanyahu to extend the construction moratorium in West Bank settlements in a bid to resume peace talks with the Palestinians, the report said.

The French invitation to Netanyahu and Abbas was delivered in September with the expected goal of bringing the two sides together to overcome the building freeze dispute, which has brought the talks to an impasse.

Both leaders had accepted the invitation to the October 21 summit, but Netanyahu cancelled his participation "at the last minute."

The report quotes European diplomats who said Sarkozy was so outraged at the Israeli prime minister that other European leaders were informed about the contents of the telephone conversation.

The Israeli leader is said to have backed out of the event after realizing that the Obama administration "viewed it as a positive development."

"Netanyahu realized that he would come under enormous pressure on the issue of the settlements and decided to cancel his participation to avoid that pressure," the report quoted the diplomats.

Sources at the Prime Minister's Office in Jerusalem rebuffed the report, saying the conversation between Netanyahu and Sarkozy was "a routine call between friends." They added that Netanyahu cancelled his participation after the Palestinians proposed political preconditions that Netanyahu was not willing to accept.

"There was a public invitation to come to the summit and Israel accepted," a government official Sunday told Xinhua on condition of anonymity. "Israel remains ready to attend," said the official.