The White House says it is in the early stages of talks to fulfill US President Donald Trump's pledge to move the US Embassy in Israel from Tel Aviv to Jerusalem, an action that would likely spark anger in the Arab world.

"We are at the very beginning stages of even discussing this subject," White House spokesman Sean Spicer said, although aides to Trump say no official announcement is imminent.

Washington's embassy is in Tel Aviv, as are most foreign diplomatic posts.

Israel calls Jerusalem its eternal capital, but Palestinians also lay claim to the city as part of an eventual Palestinian state. Both sides cite biblical, historical and political claims.

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Trump, who vowed during the 2016 presidential campaign to move the embassy, was due to speak by phone today with Israeli Prime Minister Benjamin Netanyahu, their first call since the businessman-turned-politician took office on Saturday.

Any decision to break with the status quo is likely to prompt protests from US allies in the Middle East such as Saudi Arabia, Jordan and Egypt.

Congress passed a law in 1995 describing Jerusalem as capital of Israel and saying it should not be divided, but successive Republican and Democratic presidents have used their foreign policy powers to maintain the US Embassy in Tel Aviv and to back negotiations between Israel and the Palestinians on the status of Jerusalem.

In early December, then-President Barack Obama renewed the presidential waiver until the beginning of June. It is unclear whether Trump would be able to legally over-ride that waiver and go ahead with relocation of the embassy.

- Reuters, AAP