Israeli Prime Minister Benjamin Netanyahu’s ruling Likud Party has scored a resounding victory in the country’s election after a tight race that had put his lengthy rule in jeopardy.

With nearly all the votes counted, Likud appeared to have earned 30 out of parliament’s 120 seats, in a position to be able to build a coalition government with its right-wing and religious allies with relative ease.

The election was widely seen as a referendum on Netanyahu, who has governed the country for the past six years. Recent opinion polls indicated he was in trouble, giving chief rival Isaac Herzog of the opposition Zionist Union a slight lead.

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Exit polls showed the two sides deadlocked but once the actual results came pouring in early on Wednesday, Likud soared forward. Zionist Union wound up with just 24 seats.

Even before the final results were known, Netanyahu declared victory and pledged to form a new government quickly.

“Against all odds, we achieved a great victory for the Likud,” Netanyahu told supporters at election night headquarters. “I am proud of the people of Israel, who in the moment of truth knew how to distinguish between what is important and what is peripheral, and to insist on what is important.”

Netanyahu focused his campaign on security issues, while his opponents instead pledged to address the country’s high cost of living and accused the leader of being out of touch with everyday people.

His return to power likely spells trouble for Mideast peace efforts and could further escalate tensions with the United States.

Netanyahu, who already has a testy relationship with US President Barack Obama, took a sharp turn to the right in the final days of the campaign, staking out a series of hard-line positions that will put him at odds with the international community.

In a dramatic policy reversal, he said he now opposes the creation of a Palestinian state – a key policy goal of the White House and the international community. He also promised to expand construction in Jewish areas of east Jerusalem, the section of the city claimed by the Palestinians as their capital.

Netanyahu hopes to form a new government within weeks.

“The prime minister intends to begin forming the government immediately in order to finish the task within two to three weeks,” a Likud Party statement said.

Herzog has conceded defeat and congratulated Netanyahu.

-AAP