JERUSALEM, March 26 (Allyn Fisher-Ilan - Reuters) - Israel and the United States failed to resolve the issue of expanding Israeli settlements in occupied Jerusalem during Prime Minister Benjamin Netanyahu's visit to Washington, a spokesman said on Friday.

A list of understandings had been reached but disagreements remained on terms for renewing peace talks with Palestinians, Netanyahu's spokesman Nir Hefez said.

Hefez had earlier told Israeli Army Radio the understandings Israel had achieved included construction policy in Jerusalem doesn't change. But he later clarified that he meant Israel's position had not changed, not that Washington had agreed to it.

In a statement to Reuters, Hefez said what he had told the radio was related only to Israel's position and did not at all relate to the American position.

He gave the interview before a scheduled meeting of senior cabinet ministers on Friday to debate proposed gestures to Palestinians to revive peace talks stalled since late 2008.

Hefez said that in addition to understandings achieved by Netanyahu in his three days in Washington including a 90-minute session with U.S. President Barack Obama at the White House on Wednesday there were additional points still in disagreement.

The Obama administration had also objected to Israel's latest settlement plans for East Jerusalem, including a blueprint for 1,600 housing units published while Vice President Joe Biden was visiting, igniting new controversy this month.

Israel captured East Jerusalem and the West Bank in a 1967 war and annexed the city in a move not recognised internationally. Palestinians want East Jerusalem as capital of a future state they seek in the occupied West Bank.