Indonesia is the world's most populous Muslim-majority nation and does not have formal diplomatic ties with Israel, while publicly supporting Palestine. It is unclear who could now host the tournament.
GCC urges Washington DC "to assume its responsibilities in responding to all measures and statements that target the Palestinian people".
Palestine slams Israeli decision as a "betrayal" of PM Netanyahu's recent pledges to halt all illegal settlement activities during recent meetings in Jordan and Egypt.
Israeli military acknowledges it made a "mistake" in launching secretive influence campaign in an abortive attempt to improve Israeli public's view of army's performance in the war.
Israeli Finance Minister Bezalel Smotrich, who had previously called for the Palestinian village of Huwara to be "erased", told an audience in France that existence of Palestinians was "an invention".
The legislation passed in 2005, barred Israelis from residing in areas of the occupied West Bank, but the amendment, approved last night, permits Israelis to return to these sites near the city of Nablus.
Smotrich, who has a history of incendiary remarks, faced international rebuke earlier this month after calling for a Palestinian town in the occupied West Bank to be "wiped out".
A "security approval" is also required for Palestinians in the occupied West Bank to visit their relatives in the 48 territories, or for foreigners to visit their relatives.
They also emphasised the necessity of both Israelis and Palestinians preventing any actions that would disrupt the sanctity of Holy Sites in the occupied East Jerusalem during Muslims' holy month of Ramadan.
The meeting is the second attempt by the sides, shepherded by regional allies Egypt and Jordan as well as the US, to end a year-long spasm of violence.
Yazan Omar Jamil Khasib, 23, who was killed by Israeli forces near Ramallah in occupied West Bank, becomes this year's 100th fatality of conflict rooted in decades of Israeli occupation of Palestine.
Ehud Olmert, who served as premier from 2006-2009, says he is aware his call "is quite extraordinary" but the situation calls for it, adding "I think the present government of Israel is simply anti-Israeli."
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