The British consulate in East Jerusalem was due to shut on Thursday, 30 days after Israel's foreign minister, Gideon Saar, ordered its closure. Reuters journalists saw workers remove plaques reading "British Consulate General" and another marking its consular section, although the UK flag was still flying over the building. The UK Foreign Office declined to say whether the consulate was still operating or whether its diplomats had returned home.

Israel ordered the closure in response to a series of British measures against Israeli settlements in the occupied West Bank, including a ban on importing goods made there and sanctions on those who help build or finance them. The United Nations and most countries consider the settlements illegal under international law; Israel disputes this. Unverified Israeli media reports say London threatened to expel 27 Israeli diplomats if the closure went ahead. The UK has tried to keep the mission open, including by sending its national security adviser to Israel for talks last week. Observers describe the dispute as the lowest point in UK-Israeli relations for decades, even though the two countries remain close economic, security and intelligence partners.

The closure does not affect the UK embassy in Tel Aviv, which handles relations with Israel's government. The consulate, in the Sheikh Jarrah neighbourhood of East Jerusalem, deals with the UK's relations with Palestinians in Jerusalem, the West Bank and Gaza, and provides consular services to Palestinians. The UK's presence in the city dates back almost 200 years, well before Israel's founding in 1948. The current compound was bought in 1963, when East Jerusalem was under Jordanian control, and was ready in 1967, just as Israel captured the area in the Six-Day War. The UK has never recognised Jerusalem as under any single country's control, and its consul-general reports directly to the Foreign Office rather than to an ambassador.

Analysts say Palestinians will bear the main cost. Amjad Iraqi of the International Crisis Group noted that Israel's response targeted Britain's ability to support Palestinians rather than the core of UK-Israeli ties, and called it a low-cost move in Israeli eyes. Israel has already curtailed the diplomatic activities of the Netherlands, Spain and Norway in the West Bank.

In Sheikh Jarrah, a quiet area of diplomatic missions and international organisations' offices, residents seemed resigned. Abu Abdo, 79, a former repairman, pointed to Britain's historic role through the 1917 Balfour Declaration, which backed a Jewish homeland in Palestine, and said Palestinians had seen "very little but studies and words, no action from the international community."