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Israeli settlement expansion has surged in the two months since the diplomatic Quartet called for a halt to the construction of Jewish outposts on Palestinian land, the UN envoy said on Monday.

In a much-awaited report, the Quartet - the United States, Russia, the European Union and the United Nations - urged Israel to stop building settlements and called on the Palestinians to cease incitement to violence.

But Nickolay Mladenov, the UN coordinator for the Middle East peace process, acknowledged that this appeal had fallen on deaf ears.

"Its recommendations continue to be ignored, including by a surge in Israeli settlement-related announcements and continuing demolitions," Mladenov told the Security Council.

The Quartet report was to serve as the basis for reviving the Israeli-Palestinian peace process that has been comatose since a US initiative collapsed in April 2014.

There has been growing alarm that the construction of Jewish settlements on land earmarked to be part of a future Palestinian state is killing off prospects for a peace deal based on the two-state solution.

Since 1 July, Israeli has advanced plans for over 1,000 housing units in occupied east Jerusalem and 735 units in the West Bank, Mladenov said. 

Prime Minister Binyamin Netanyahu's government is also seeking tenders for 323 units to expand east Jerusalem settlements and for 42 units in Kiryat Arba near Hebron, for which it is allocating $13 million in new funding.

Israel has undertaken a land survey on the outskirts of Bethlehem for the establishment of a new settlement in a move that would contribute to the "dismemberment of the southern West Bank," said Mladenov.

[The Quartet's] recommendations continue to be ignored, including by a surge in Israeli settlement-related announcements and continuing demolitions. - Nickolay Mladenov

Demolitions of Palestinian homes are on the rise in the West Bank, with over 130 structures destroyed.

Mladenov singled out the Bedouin communities from east Jerusalem and the Susiya area in the southern West Bank, warning that "the demolition of this community would set a dangerous precedent for displacement."

"All of these plans would essentially create new illegal settlements and I call on Israel to cease and reverse these decisions," he said.

Netanyahu has repeatedly rejected calls for a halt to settlement expansion, claiming that the residential projects are not an obstacle to peace.

The Security Council declared Israeli settlements in occupied territory to be illegal in a resolution adopted in 1979. 

Mladenov said that determination was "equally true and even more urgent a concern today."