Just hours after a UN report on last year's Gaza flotilla incident was published on Friday (September 2nd), Turkey announced it would expel Israel's ambassador to Ankara and suspended all military agreements with its former ally.
Now, relations between the two countries are "even worse than they were right after the Mavi Marmara event", says Salih Kapusuz, deputy chairman of ruling Justice and Development Party (AKP), responsible for public relations.
"Our position was clear from the very beginning. Whatever the outcome we're ready for it," Kapusuz said. "The whole world knows, as does Israel, that whatever the justification this wouldn't go unanswered."
Nine Turkish activists died on May 31st, 2010, after Israeli commandos boarded the aid ship Mavi Marmara and were met with resistance. Friday's report by the UN found that although the action was justified under international law, Israel had used excessive force.
Ankara has demanded an official apology and reparations to the families of the victims, but Israel has so far declined.
"Israel regrets any loss of life or injuries during the incident," says Arthur Lenk, director of the Israeli foreign ministry's Department of International Law and a staff member on the UN panel. He said his country "accepts the Panel's report and hopes Turkey will work with it on restoring their ties and improve relations in the mutual interest of both countries".
"Relations with Turkey have been, and remain, very important to Israel," he said. "Accordingly, Israel has made significant efforts to reach a bilateral agreement that would enable both countries to put the flotilla incident behind them and to improve relations."
"Now that the UN Secretary General's report is published, we hope that a compromise in such a spirit will be achieved," he added.
Alon Liel, former Israeli ambassador to Turkey, says over the past six months "apologising or not apologising" was the main issue in Israeli-Turkish relations.
"Israel decided not to apologise over one year ago and will have to live now with the results of its refusal -- a Turkish dramatic downgrading of the Turkish-Israeli diplomatic link to the rank of a second secretary, the lowest diplomatic rank in the Israeli diplomatic service."
"The damage to the Israeli-Turkish bilateral link is obvious and unavoidable," he adds.
For Hikmet Cetin, Turkey's former foreign affairs minister, "it is unfortunate that the Gaza incident is being driven to [such] a dangerous level."
"In the history of our countries there has never been such a problem. This is the wrong path for both Israel and Turkey," he argues. "Diplomacy needs patience and time. Only in this way can there be a solution."
However, Cenk Sidar, managing director of Washington-based Sidar Global Advisors, believes there is no room for Turkey to make concessions.
"The ball had been in Israel's court, and it will stay there for a while," he says. At the same time, he added, "further deterioration of Israeli-Turkish relations is an enormous risk for the region at a time of heightened and wide-spread unrest."
The current state of affairs has left leaders searching for a way out of the impasse.
Cetin says a "sharp turn" is needed with the support of international and local society.
"It also can come on a cultural level, even from football diplomacy," he mentions, pointing to the upcoming UEFA Champions League match that might be played in Istanbul between Besiktas (Turkey) and Maccabi Tel-Aviv (Israel), on September 15th.
Although it is unclear whether the Israeli team will come to Turkey, officials in Ankara pledge to show maximum hospitality.
"Politics and sports are separate," Minister of Youth and Sports Suat Kilic says. "We view this match from the perspective of sports. The Turkish people will show hospitality to anyone who comes for international contests to our country."
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