Israel’s Natural Gas Windfall in Europe Is Terrible News for the Region
In its quest to secure new energy supplies, Europe is on the verge of transforming the Middle East’s longest-running conflict. The Ukraine war and the decoupling of Europe’s reliance on Russian natural gas has led European Union member states to frantically look for new energy sources. The recent news that Germany is firing up long-dormant coal-powered plants is a significant setback for years of positive growth in the green energy sector. Coal will mitigate some energy concerns, but it can’t replace Europe’s need for natural gas. The continent is looking to kickstart Israeli natural gas imports, and this subsequent cash windfall for Israel could transform its relationship with the Palestinians forever.
More than a decade ago, Israel discovered several sizable natural gas fields in the Eastern Mediterranean. Since then, the gas fields have been the source of ongoing controversy and geopolitical intrigue. Turkey was the first country to express serious interest in Israeli natural gas. Despite verbose rhetoric from Ankara over Israel’s treatment of the Palestinians, Turkey wanted to become a key conduit of Israeli gas into Europe in its quest to reshape itself as a hub nation for hydrocarbons.
The Turkish-Israeli deal required a complex pipeline that would have had to navigate Greek, Cypriot, and possibly Lebanese waters. By the end of 2018, the Turkish pipeline project fell apart and was quickly replaced with a new $7 billion EastMed project that would connect Israel’s offshore fields to Greece through Cyprus and Crete.
As I wrote in 2019, the pipeline was meant to deliver 10 billion cubic meters of gas per annum to energy-hungry markets in the EU, “which will bring in billions of dollars for Israel, Greece, and Cyprus while providing lower gas fees for northern customers who have been dependent on Russia and other Middle East countries until now.” The United States ended its support of the EastMed pipeline in January but the bones of the deal appear to form the basis of a new agreement between Europe, Israel, and Egypt.
The Ukrainian conflict accelerated these efforts to find a solution. Last week, European Commission president Ursula von der Leyen said that the EU was preparing two “major” energy infrastructure projects to…