The Palestinian president warned Tuesday that a fire in a West Bank mosque he blamed on extremist Jewish settlers could endanger Israeli-Palestinian peace talks, just before they are set to resume.

A statement from his office said Mahmoud Abbas called the fire a "criminal" act that "represented a threat to the efforts to revive the peace process" because the Israeli army protects the settlers.

The fire ripped through the mosque in the village of Luban a-Sharkiyeh early Tuesday, but by nightfall it was not clear whether it was arson, as Palestinians charged, or accidental, as Israeli media reported.

The incident came as U.S. mediator George Mitchell was working to restart Israeli-Palestinian peace contacts after a halt of more than a year. Mitchell is set to mediate indirect talks toward a peace accord. He plans to start his mission Wednesday by meeting Israeli Prime Minister Benjamin Netanyahu.

The mosque fire destroyed holy books and prayer carpets. Although there were no witnesses, Jibril al-Bakri, the Palestinian governor of Nablus, said it was an act of arson.

The mosque has been undergoing renovations, but Jamal Daraghmeh, the village mayor, said there was no fire in the area where the work was taking place. He added that settlers attacked village property in the past.

The Israeli military said it was working with Israeli police and Palestinian authorities to determine the cause of the blaze.

Israeli media reported evidence of an electrical short-circuit in the mosque that might have started the fire. Israeli police said evidence was transferred to its forensics unit.

Also Tuesday, residents of the nearby village of Hawara said they saw settlers set fire to an olive grove close to the Jewish settlement of Bracha. The fire there destroyed about 50 trees before Israeli soldiers extinguished the flames.

"About 20 settlers came from the settlement and they set a fire here and then they left," Rida Mustafa, a village resident who said he witnessed the attack, told The Associated Press.

"Every couple of days, they come and cause trouble."

Both Hawara and Luban a-Sharkiyeh — located near the town of Nablus — are ringed by settlements.

In another development, the Palestinian government said Tuesday it is determined to stop thousands of Palestinians from working in Israeli settlements, but it won't enforce the ban until the end of the year because of economic hardships.

Setting the date, Economics Minister Hassan Abu Libdeh pledged harsh punishments for working in settlements after the ban takes effect.

"I may not be able to place Palestinian police or a judge at the gates of the settlements, but I think that every single Palestinian working in a settlement is well known to us," he said.

Another part of the law, forbidding sales of products made in settlements, is already in force. However, the ban on Palestinians working in settlements is harder to enforce because of high unemployment.

Palestinians see the more than 120 Israeli settlements dotting the West Bank as an obstacle to their goal of a state and insist that construction there must stop.

However, about 23,000 Palestinians work in the settlements, an important source of income when nearly a quarter of the Palestinian labour force is out of work.

The anti-settlement law, signed last week by President Abbas, imposes fines of up to $14,000 and jail time of up to five years on violators.