The reason why the Israeli-Palestinian peace process is doomed can be summed up in a paragraph. The Arab populations left in political limbo when Israel recaptured in 1967 the territory that it had lost to Egypt and Jordan in 1948 exist only as a strategic weapon of disruption. They have been shaped into a population that is defined only by terrorism because that is the purpose that their sponsors put them to. There can be no constructive outcome of the conflict because you cannot negotiate with a weapon.The only comment I would make is that it will end because those national sponsors of terrorism are doomed demographically and economically. The Middle-East, as a whole, may be a few decades behind the birth dearth in Europe and China, but their populations will eventually crash. At about the same time (or perhaps even before) their oil reserves (with its revenue) will dry up.
The trouble is not that Israel is unable to reach a settlement with the Palestinians; but that the Muslim countries funding and operating the terrorist groups that constitute the Palestinian political factions are unwilling to give up their weapon. Negotiating with the Palestinian Authority or Hamas is like trying to negotiate with a gun or bargain with an attack dog. There is nothing to be gained from such a futile task. The conflict will end only when those countries that are behind it will decide that it should end. And they have no reason to want it to end.
Palestinian terrorism is a strategic weapon of disruption that confines and unbalances Israel. At a cost of millions, the sponsors of that terror have inflicted billions in economic damage. And there is no reason for them to stop. Watching Israel and America try to reason with their attack dogs amuses them and allows them to expand their own influence by offering to act as mediators.
For that same reason, Islamic terrorism in general is also not going anywhere. What the Palestinians are to Israel, Muslim terrorists are to the West and the rest of the world. They are strategic weapons which are allowed to exist because they serve the purposes of their sponsors. Like most living weapons, they occasionally turn in the hands of their sponsors, but that only makes the task of directing them at the proper targets more urgent.
Terrorism can never be defeated by fighting terrorists. Combine massive wealth in some parts of the Middle East with staggering poverty in other parts and the supply of mercenaries is nearly endless. Syrian Jihadists are being paid $150 a month by Qatar; a good salary for an unskilled laborer in a region where life is cheap and every family has plenty of surplus sons and mouths to feed. A barrel of oil can buy the services of a killer for a month and Qatar pumps out millions of barrels a day.
Terrorism is cheap for the sponsors, profitable for the participants and hideously expensive for the targets. A soldier in a First World nation can cost six figures. For that same amount, a backward oil tyranny can field a hundred men. When those hundred men kill a soldier, then his nation will be heartbroken and question the costs of war. When those hundred men die, their mothers will ceremonially wail and cry out for more martyrs to avenge them. And the terror will go on.