In recent days, rumors have been circulating regarding the possibility of U.S. sanctions on Israel as punishment for settlement-building. Since such measures would undoubtedly be blocked by Congress, it is extremely unlikely that the administration would actually attempt them. So, assuming the rumors are based on White House leaks, they must have some other purpose. Elliott Abrams writes:
What could possibly be the administration’s goal in “mulling” sanctions and seeing such stories appear in the press? Simple: giving a signal to Europe. The debate is hot and heavy in Europe right now about sanctions, BDS, and recognition of a Palestinian state. There is no way for the administration to intervene in that debate on the anti-Israel side—except in news stories suggesting how angry it is at the government of Israel. That support for Israel in Congress means no such sanctions are possible would not deter the Europeans; in fact it would spur them on to do what they might believe the president would do if he could only get past the “Israel lobby.”
Read more on Pressure Points: http://blogs.cfr.org/abrams/2014/12/09/why-the-news-stories-about-sanctioning-israel/