In an interview with Israeli television aired on Tuesday, he offered a bleak outlook for decades of negotiations on Palestinian statehood bearing any fruit during the 18 months he has left in office.
"I don't see the likelihood of a framework agreement," Obama said in an interview with Uvda, a current-affairs program produced by Israel's top-rated Channel Two and Keshet television. "The question is how do we create some building blocks of trust and progress."
On the eve of his March 17 election to a fourth term, Netanyahu said there would be no Palestinian state if he remained premier.
Netanyahu has since sought to row back from those remarks but his peace overtures have met with scepticism from the Palestinians as well as Western diplomats.
"So the danger is that Israel as a whole loses credibility. Already, the international community does not believe that Israel is serious about a two-state solution."