There is as yet no commonly accepted European identity cards. Only the passport is commonly accepted. So if you travel in Europe and lets say you need to show an ID at a hotel, your passport is the only thing guaranteed to be accepted. Also I think you still need a passport for the UK.
Palestinians call general strike in J'lem Old City over police conduct, settler violence (Haaretz)
from the article: Fear is driving Israelis to obtain foreign passports