Banning trade with illegal Israeli settlements has gained the most support from a range of options discussed by EU foreign ministers at a meeting in Brussels.
The options, which also included tariffs and stricter licensing requirements, had been presented by the European Commission in response to increasing violence by Israeli settlers against Palestinians.
According to the bloc's foreign policy chief Kaja Kallas, the issue will now be passed to EU ambassadors to press forward with potential action.
"Everybody agrees that the situation in the West Bank is really intolerable", she said.
"It is actually making it more and more impossible that the two-state solution can ever come into effect."
The response was one of several key issues discussed today, in what was the first meeting of the Foreign Affairs Council under Ireland's EU Presidency.
Among those attending was Minister for Foreign Affairs and Trade Helen McEntee, who earlier expressed her support for a "full ban on trade in the occupied territories".
"I think it is absolutely essential that the EU responds in a way that upholds international law and respond to the ECJ (European Court of Justice) ruling of 2024," she said.
"At home obviously I’m bringing forward legislation that will support that ban on goods in the occupied territories, and I hope to have that enacted by the end of next week."
The slow pace of the discussion within the EU has angered countries keen to curb trade. Some diplomats have accused the European Commission - and in particular its President Ursula von der Leyen - of dragging their feet.
There is also disagreement in Brussels as to whether any such move would need backing from all 27 member states or just a weighted majority.
Key players such as Germany and Italy are reported to still be undecided on any such move.
'Concrete proposals'Belgium's foreign minister Maxime Prevot said ahead of the meeting that the options laid out appeared to be more "a bone to gnaw on than a genuine desire to move forward".
"We are calling for concrete proposals," he said.
Even if the commission does now come up with a proposal, it does not mean that a ban will be adopted.
Israel has occupied the West Bank since 1967. More than 500,000 Israeli settlers live in the territory, excluding east Jerusalem, among some three million Palestinians.
UN chief Antonio Guterres has condemned the "relentless" expansion of Israeli settlements in the West Bank, saying in a report seen by AFP last month that they are contributing to the territory's worst displacement crisis since 1967.
The EU has long been hampered by divisions over its approach towards Israel, with some members staunchly backing the country and others supporting the Palestinians.
Additional reporting: AFP