UN Secretary General Ban Ki-moon has condemned the killing of an 18-month-old boy in an arson attack by suspected Jewish settlers in the Israeli-occupied West Bank.

Mr Ban called on the perpetrators of what he called a "terrorist act" to face justice, and expressed condolences for the family of Ali Saad Dawabsha.

According to Palestinian security officials, four suspected settlers set fire to the family's house before fleeing to a nearby Jewish settlement. The baby's parents and four-year-old brother were among four people wounded.

The Israeli military and army radio said two homes had been torched by two masked men and graffiti reading "revenge" had been written in Hebrew.

The attack added to tensions between Israelis and Palestinians, sparking protests by hundreds of people and sporadic clashes.

Prime Minister Benjamin Netanyahu made a rare call to Palestinian president Mahmoud Abbas in a bid to avoid further escalation.

Mr Ban urged "both sides to take bold steps to return to the path of peace."

He added: "Continued failures to effectively address impunity for repeated acts of settler violence have led to another horrific incident involving the death of an innocent life. This must end.

"The absence of a political process and Israel's illegal settlement policy, as well as the harsh and unnecessary practice of demolishing Palestinian houses, has given rise to violent extremism on both sides."