Prime Minister Benjamin Netanyahu vowed Thursday that all of Jerusalem would always remain under Israeli sovereignty, in comments likely to spark consternation among Palestinians who hope to make the city the capital of a future state.

"United Jerusalem is Israel's capital. Jerusalem was always ours and will always be ours. It will never again be partitioned and divided," Netanyahu said at a state ceremony to mark Jerusalem Day.

Netanyahu said he had made the same declaration during his visit to Washington this week, where he met with U.S. President Barack Obama and discussed the peace process and Iran's nuclear program.

Jerusalem Day celebrates the conquest of the city during the 1967 Six-Day War, before which Jordan controlled East Jerusalem, while Israel had the western section. Shortly after the war, Israel annexed East Jerusalem.

"Only under Israeli sovereignty will united Jerusalem ensure the freedom of religion and freedom of access for the three religions to the holy places," Netanyahu added.

The ceremony took place at Ammunition Hill in East Jerusalem, the site of one of the bloodiest battles in the city in the 1967 war, and now part of a Jewish neighborhood.

"Jerusalem was a city whose main streets were lined with shelters from sniper fire," Netanyahu said, referring to the period when the city was divided between Israel and Jordan. "A city whose residents could not move freely from place to place. All that changed forever in 1967."

"The new U.S. administration informs us with intolerably ease that we have to give up Jerusalem," the Likud politician said. "With all due respect, the U.S. president sees the American interest and does not know that Jerusalem is not a territorial issue, but a much deeper one - 'the hope of two thousand years/the land of Zion and Jerusalem,'" he said, quoting the national anthem.

Meanwhile, Foreign Minister Avigdor Lieberman told the Federation of Israeli Chambers of Commerce that he did not consider Jewish settlements in the West Bank to be an obstacle to peace talks.

"Let's put prejudice aside. Who decided that the settlements in Judea and Samaria are an obstacle to peace?" he asked. "Was there peace [before the Six-Day War]? It was the same: terror, tension. Those who seek to present the conflict as being territorial are making a mistake; if you make the wrong diagnosis then you'll find the wrong medicine."

The foreign minister also commented on Prime Minister Benjamin Netanyahu's meeting with Obama, complementing him for how he handled an "uneasy" task.

"On the strategic level we have a complete understanding [with the U.S.]: stopping Iran, dismantling or preventing it from getting non-conventional weapons, stopping the plan that endangers the entire world and identifying Iran as a central source of instability in the Middle East regardless of the nuclear issue," Lieberman said.