Asselborn: Trump plans for Jerusalem are 'oil on fire'

US President Donald Trump's controversial decision to recognise Jerusalem as Israel's capital will put "oil on the fire" of the Middle East conflict, Luxembourg Foreign Minister Jean Asselborn has said.

Trump is expected to break with years of US foreign policy in a speech later today by formally declaring Jerusalem as Israel's capital.

He is also expected to approve moving the US embassy from Tel Aviv – although not for several years.

Asselborn told reporters on Tuesday the decision could inflame tensions with Palestinians.

"It's oil on the fire in Israel/Palestine when one designates Jerusalem as the capital of Israel," he said ahead of a meeting with US Secretary of State Rex Tillerson in Brussels.

"That's oil on the fire that can become very very explosive."

The decision has been met with condemnation from regional leaders – including Turkish president Recep Tayyip Erdogan, who warned Trump that declaring Jerusalem Israel's capital was a "red line" for Muslims.

The city hosts sites considered holy in the Muslim, Christian and Jewish faiths, while Palestinians consider east Jerusalem as the capital of a future state.

Since the 1967 Six-Day War, the city has been governed by Israel after it captured east Jerusalem from the Jordanians.

At the meeting with Tillerson on Tuesday, Asselborn, alongside the other 27 EU foreign ministers, also discussed the situation in Syria, the Iranian nuclear agreement, Russia's policy and cooperation with Ukraine and tensions on the Korean peninsula.