The U.N.'s top envoy for the Middle East peace process said Tuesday that Israel's refusal to halt settlements in Palestinian territories is a “serious setback” and that the United Nations considers the construction illegal. The envoy, Robert Serry, said he told the U.N. Security Council that complications caused by Israel's renewed building in the occupied West Bank and East Jerusalem required renewed international effort in what would now be a “critical” year. “This is a serious setback,” Serry told reporters after briefing the council. “I have also made it very clear for the United Nations where we stand, that we will continue to consider settlements as illegal under international law, and that we will also continue to hold Israel responsible under international law.” Serry said the new obstacles required renewed effort from the diplomatic Quartet-the United Nations, the United States, the European Union, and Russia. “I've said that next year, the credibility of this political process and its sponsors, including the Quartet, will be at stake,” he said. Palestinian leaders have not attended U.S.-brokered talks with Israel since the moratorium on settlement building ended in October. President Barack Obama set a one-year deadline to reach an agreement, and his administration has now embarked on separate talks with the two sides seeking a permanent peace accord.