Barack Obama Needs a Geography Lesson

Today, President Obama once again called for a "contiguous" Palestinian state.

During a press conference following their meeting President Obama reaffirmed his administration’s belief that the “Palestinians deserve an end to occupation and the indignities that come with it,”  through an “independent, viable and contiguous Palestinian state as the homeland of the Palestinian people alongside the Jewish state of Israel.”

Question: How will that work?

The orange parts are the Palestinian areas. The big green part is Israel, "big" being a very relative term here. The entire area is tiny by American standards.

Both Israel and a future Palestinian state cannot be contiguous at the same time, unless:

A. Either the West Bank or Gaza are ceded to Israel, thus confining the Palestinian state to the area not ceded.

B. Israel itself becomes the Palestinian state, so the entire area becomes one larger Palestinian state.

At this point we can rule out B, because Obama did call for Israel to continue to exist as a Jewish state. No one is contemplating A that I'm aware of.

There is a third possibility: The Palestinian state becomes contiguous at the expense of bisecting Israel. Obama didn't explicitly rule that out in his comments.

In the past, Obama has called for Israel to retreat back to its 1967 borders. But Israel would have to go back to something like the 1947 mandate borders to get the Palestinians into a contiguous state. Like this.

Is this what Obama has in mind? Or does he just not know what he's talking about?