Clearly it would be ridiculous to suggest we know how to solve this. Many have tried and no solution has yet been found. That is not to say that it is impossible but only that it is very complex.
The following simply makes some suggestions and asks some questions.
Empathy In The Israel-Palestine Conflict: A New Approach To Peace - Professor Simon Baron-Cohen (The Jewish Chronicle, 2015)
As has been proposed several times before, could Palestine be divided into an Israeli state and a Palestinian state?
Those who are fighting for the elimination of Israel would not agree to any recognition of an Israeli state.
Beyond that, there would be issues that would have to be worked through:
the borders
guaranteed security
who governs Jerusalem?
That might be the desire of some extreme factions of the Palestinians but would there be any justice in that? Israel has a millennia-long attachment to the land. They must have some rights to exist in that land. This might be the result if the Palestinians won a military victory?
Would the suggestion be:
Israelis live under Palestinian rule?
Would they have freedoms and civil rights e.g. freedom of religion, of movement, of expression...?
Israelis are expelled from the land (again)?
Where would they go?
Would there be any justice in that?
All Israelis are killed.
That sounds horrific but, again, it is the desire of the more extreme Palestinians.
All of the above questions could be asked in the other direction although I am not aware that anyone is suggesting this.
I am also not aware that there are extreme Jews seeking the elimination of Palestinians, although in our crazy, polarised world, that is not impossible.
Would this be possible? Could the issues be negotiated and an agreement reached?
It would, again, not be acceptable to those who wants to see Israel and Israelis eliminated.
The issues would include:
guaranteed security
an agreed form of government
Israelis fear that, as the number of Palestinians increases, Jews will become a minority and there will no longer be an Israeli state. It will become an Arab state.
If we do not want the ongoing tensions, uprising, hatred, and killings, we have to find another solution. That will require compassion and compromise.
It might be that we do prefer the current situation.
When Jesus returns, there will be perfect justice and peace.
The inauguration of justice will required dealing with all that is, and has been unjust. Everyone with a stake in this issue will be accountable before God but the upshot will be peace and security for those who have chosen to follow Jesus and so have been forgiven.
Should we assume that there is no other prospect of peace? Or, should we still be working for peace now?
Are there biblical reasons for believing that there can be no peace until Jesus returns?
Either way, we are told to pray for the peace of Jerusalem (Ps 122:6).
Israel-Palestine Conflict: What Hope Of A Solution? - (UK Parliament)