The Foreign Minister says he hopes intervention from New Zealand will help jolt Israel and the Palestinian Authority into making some sort of progress in the peace process.
Mr McCully is in the Middle East, where he has met with Prime Minister Benjamin Netanyahu in Jerusalem, and President Mahmoud Abbas in Ramallah.
He said both parties had agreed in principle to meet to pursue peace, but could not agree on the exact circumstances or conditions.
Mr McCully said New Zealand wanted to take advantage of its position on the United Nations Security Council to try to broker some progress.
"New Zealand having been elected to the UN Security Council is determined to see that the Security Council lives up to its responsibilities in relation to the Middle East peace process.
"So if others don't get an resolution to come forward, that's something that we will consider - so it's really a time coming up over the next couple of months where those decisions will have to be made."
Mr McCully said New Zealand would continue work on a Security Council resolution, but would also keep an eye on a paper that France, a permanent member of the council, was working on.
He said after his talks, he believed there was space to bring the two parties together - the right conditions just had to be created to clear the way for that to happen.
He said obviously Prime Minister Netanyahu and President Abbas are the two principal players.
"If they won't sit in the room and try to come to some arrangement, a way to move forward, then obviously the rest of the international community is going to be wasting its time.
"So we really do need to see a constructive attitude from the primary players, and of course from big neighbours like Egypt, where I visited earlier in the week, and of course the United States has got an indispensable role in any progress in the Middle East peace process."
Mr McCully said New Zealand had an independent voice and a good relationship with both parties, so could have an important role as an honest broker.