Not naming the capital of Israel is the diplomatic thing to do. Not the right thing, perhaps, but certainly diplomatic. It’s why we have the State Department; we can take the moral high ground while deploring their actions and they get stuff done.
Much like dealing with a gaggle of squirrely 3 year-olds we need to cajole both sides into doing stuff for us regularly. Don’t bomb that country. Stop fighting back there. Yes, they got more stuff, life isn’t fair. Stop whining or we’ll give you something to whine about. Could you please stop mass murdering your citizens, etc. We really shouldn’t piss off either side if we ever want to get stuff done with either side, and not answering is the best way to do that.