Israel and Turkey may be close to a full normalization of ties, including the reopening of national embassies, according to Turkish media outlet Today's Zaman.
According to the paper, at a recent meeting in Ankara between Prime Minister Binyamin Netanyahu's representative on energy and security issues, David Meidan, and the head of Turkey's National Intelligence Organization (MİT), Hakan Fidan, a possible visit by Turkish PM Recep Tayyip Erdogan to Israel was seriously discussed.
However, a spokesperson for the Israeli Prime Minister's Office denied the report, saying that no such dramatic breakthroughs had yet been made in the attempt to mend relations between the two former allies.
The claims of progress come as Turkish Foreign Minister Ahmet Davutoglu echoed his country's Deputy Prime Minister's comments earlier this week, saying that a contentious compensation deal with Israel over the death of Islamist activists on the Mavi Marmara Gaza flotilla in 2010 was close to being settled.
"Progress has been made to a great extent, but the two sides need to meet again for a final agreement," he said, and added that his government's "first job" after the upcoming local elections "will be making sure the compensation is bound by a legal document".
Davutoglu also said that "an answer is expected from the Israeli side" to Turkey's demands.
Relations between the once-close allies had soured after Erdogan famously stormed out of a televised debate with Israeli President Shimon Peres over Israel's Cast Lead counterterrorism operation in Gaza, back in 2009.
But the attempt to break Israel's blockade of Hamas-controlled Gaza by Turkish Al Qaeda-linked Islamists and left-wing activists, and the IDF's subsequent interception of the Mavi Marmara, marked the lowest point in relations between the two countries. Nine Islamists were killed and several others injured as they violently attacked the lightly-armed soldiers sent to intercept what was thought to be a group of peaceful protesters, prompting the use of live fire in self-defense by Israeli forces.
In response, Turkey expelled Jerusalem's ambassador to Ankara, prompting Israel to do the same.