"I'm torn by two perspectives in this regard," he said. "One is the one which I've had for some time, which is that the Palestinians have no interest whatsoever in establishing peace, and that the pathway to peace is almost unthinkable to accomplish."
He also said pushing Israel to give up disputed territory for a two-state solution with the Palestinians "is the worst idea in the world."
"I look at the Palestinians not wanting to see peace anyway, for political purposes, committed to the destruction and elimination of Israel, and these thorny issues, and I say, 'There's just no way,'" he went on to say.
The controversial comments made by Romney surfaced Tuesday, a day after he came under fire for dismissing nearly half of all voters who he said were dependent on government.
His comments on the Israeli-Palestinian conflict were captured on video during a private fundraiser held May 17 in Boca Raton, Fla. It was the same event during which Romney was recorded dismissing nearly half of the nation's voters, saying Obama supporters are dependent on government and have a victim mentality.
"There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe that government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you name it," Romney is heard on the video saying.
Both video clips were posted by the liberal magazine Mother Jones.
Romney was left to perform damage control during an impromptu press conference Monday after those comments were posted online.
"It's a message which I'm going to carry and continue to carry which is the president's approach is attractive to people who are not paying taxes because, frankly, my discussion about lowering taxes isn't as attractive to them and therefore I'm not likely to draw them in to my campaign," he said.
In a tape TV interview, President Barack Obama responded to Romney's remarks saying the occupant of the Oval Office must work for everyone, not just for some. The Obama campaign has posted the video online asking voters to watch the comments and respond.
Campaigning in Iowa on Tuesday, Vice-President Joe Biden declined to weigh in.
"I'll let his words speak for themselves," Biden said.
The man behind the leaked video is speaking out. James Carter IV, the grandson of former President Jimmy Carter, says he put the source who shot the video in contact with Mother Jones.
"It's poetic justice that a Carter was the one that helped to get out this video that has given the Romney campaign so much trouble," Carter said.
Conservatives have been deeply divided on Romney's comments.
The Associated Press contributed to this report.