There is "an extraordinary opportunity" in the coming months for Israel to normalize ties with its Arab neighbors, US Secretary of State Antony Blinken said on Saturday, while also emphasizing the need for the creation of a Palestinian state.

The top US diplomat said there were genuine efforts led by Arab countries to revitalize the Palestinian Authority so it can be more effective in representing the Palestinians.

"Virtually every Arab country now genuinely wants to integrate Israel into the region to normalize relations...to provide security commitments and assurances so that Israel can feel safer," Blinken said during a panel discussion at the annual Munich Security Conference.

"And there's also, I think the imperative, that's more urgent than ever, to proceed to a Palestinian state that also ensures the security of Israel," he added.

Last month, the Saudi ambassador to the UK Khalid bin Bandar Al Saud told the BBC Saudi Arabia is interested in normalization with Israel following the conclusion of the IDF's war on Hamas in Gaza.

However, the envoy said, Saudi Arabia had one condition - the creation of a Palestinian State. According to the ambassador, before the October 7 massacre, both countries were close to reaching an agreement.

Blinken: Ending Gaza war, two-state path needed for Saudi deal with Israel

Last week, during his visit to Israel, Blinken told reporters in Tel Aviv that Saudi normalization with Israel is dependent on an end to the Gaza war and Israel’s willingness to embark on the path to a two-state resolution to the conflict.

“When I saw the Crown Prince [Mohammed Bin Salman] in Saudi Arabia just a couple of days ago, he repeated to me his desire and determination to pursue normalization,” Blinken said as he referred to his visit to the Kingdom on Monday night as part of his weeklong trip to the region.

Bin Salman repeated that normalization required two things, Blinken said, “One, there needs to be calm in Gaza; two, there needs to be a clear and credible pathway to a Palestinian state.”

Tovah Lazaroff contributed to this report.