Israel has not stopped building illegal settlements in the West Bank, which are considered illegitimate by the international community and the US government. Until the US government takes an active role in pressuring the Israelis to stop these settlements, there will never be peace. They prevent a 2 state solution from coming to fruition, and there are many who doubt Israel's commitment to a Palestinian state because of various statements made by many officials in Israel's government and these settlements.
The US government has also failed in implementing regulations that specifically mark settlement products as such, and allowing US companies to fund and advance the settlement enterprise, a clear breach of US law.
Until the US pressures Israel, it will never want peace.