Abe Foxman puts out a release:

Gen. Petraeus has simply erred in linking the challenges faced by the U.S. and coalition forces in the region to a solution of the Israeli-Arab conflict, and blaming extremist activities on the absence of peace and the perceived U.S. favoritism for Israel. This linkage is dangerous and counterproductive. Whenever the Israeli-Arab conflict is made a focal point, Israel comes to be seen as the problem. If only Israel would stop settlements, if only Israel would talk with Hamas, if only Israel would make concessions on refugees, if only it would share Jerusalem, everything in the region would then fall into line.

Yglesias:

I’ll be interested to see how Petraeus’ neocon fan base reacts.

By glossing over it. Max Boot:

General Petraeus obviously doesn’t see the Israeli-Arab “peace process” as a top issue for his command, because he didn’t even raise it in his opening statement. When he was pressed on it, he made a fairly anodyne statement about the need to encourage negotiations to help moderate Arab regimes. That’s it. He didn’t say that all settlements had to be stopped or that Israel is to blame for the lack of progress in negotiations. And he definitely didn’t say that the administration should engineer a crisis in Israeli-U.S. relations in order to end the construction of new housing for Jews in East Jerusalem.