ISRAEL is troubled by the perception the US is an "empire of the past" and wants a resurgent America to lead a decisive confrontation with Iran, a top official has said.

"America is tested" at a pivotal moment in the history of the Middle East, said Israel's Deputy Prime Minister, Dan Meridor, who is also the Minister for Intelligence and Nuclear Energy.

The Arab world was watching the US closely: "They look to America. If America does not seem to be able to contain the Iranian threat, will they go with Iran?"

"This is of world-order magnitude," he told the Herald in an interview. Israel, which depends on the US as its security guarantor, itself appears to have new doubts about US judgment.

Mr Meridor said he was "surprised" at the Obama administration's treatment of a longstanding US ally, Egypt's former president: "Was it necessary to immediately empower the demonstrators against him and let [Hosni] Mubarak go? It's seen by all the allies of America in the Arab world. I don't know where the tide of history will go and I'm not sure they know."