Much of the land in Baquora in the northwestern part of the kingdom and Ghumar in the south is used by Israeli farmers, some of whom were given private land ownership rights and special travel rights under a 1994 peace treaty between the two countries.

The agreement will expire next year.

King Abdullah has been under increasing public pressure to end the arrangements with Israel. He told senior Jordanian politicians the kingdom wants to exercise its "full sovereignty" over the two areas, Petra state news agency said.

"These are Jordanian lands and they will remain.." the monarch said. In an "era of regional turmoil" his kingdom - sandwiched between Syria to the north, Iraq to the east and Israel to its west - Jordan wanted to protect its "national interests," Abdullah said.

Israeli Prime Minister Benjamin Netanyahu, speaking after Abdullah's comments on Sunday, acknowledged that Jordan wanted to exercise its option to end the arrangement.

But he said Israel "will enter negotiations with it on the possibility of extending the current arrangement".

Under the terms of peace treaty, the lease would be automatically renewed unless either of the parties notified the other a year before expiry that it wished to terminate the agreement, the Jordanian Foreign Ministry said in a statement on Sunday.

Negotiations over ending the "special regime" of the two areas would be tough with Jordan facing thorny legal issues to reclaim the land where Israeli laws now apply, officials said.

Australian Associated Press