Israel comes up trumps in Europe’s quest for gas

The European Union has made the connection, now it needs to connect. It took the invasion of Ukraine for the EU countries to understand the folly of relying on Russia for their energy needs. They now need to physically link their pipelines to alternative sources.

Hence this week’s deal between Egypt, Israel, and the EU to increase liquefied natural gas supplies from what looks destined to be an increasingly important source of energy. The deal, signed in Cairo, means Israel will pipe increased supplies from its offshore gas fields to Egypt which has the facilities to liquefy it and send it on via tankers. European Commission chief Ursula von der Leyen signed on behalf of the EU saying, “What a special moment.” It is. One with several ramifications.

For the EU it’s a way of making a serious dent in its 40 per cent reliance on Russia for gas which has hampered efforts to sanction Moscow. The Egyptian effort to become a regional energy hub is boosted. Since the 2011 uprising its energy industry has been largely inactive despite the modernisation of its facilities in recent years. The Israelis, meanwhile, have secured a major market for their supplies after transitioning from being a net importer of gas to an exporter. Israel is estimated to have reserves of up to a trillion cubic metres of gas of which domestic use will consume no more than about 300 billion between now and 2050. It has two working gas fields and intends to open a third.

Before visiting Egypt, Von der Leyen was in Israel. There she said the EU was still working on two other major projects to connect the continent with Israeli energy supplies. The EuroAsia Interconnector is scheduled to be completed in 2025 when it will become the world’s longest and deepest underwater power cable. It will connect power grids from Israel to Cyprus and Greece. 

Another option to get Israeli gas into the European market is through a proposed pipeline from Israel via Turkey. While that is at least three years away, the potential for the deal is one of the reasons why Turkey’s President Erdogan has eased off on his anti-Israel rants of recent years.

Before his trip to Kyiv, Italy’s Prime Minister, Mario Draghi, was also in Israel this week, saying his country wanted to tap into “the gas resources of the Eastern Mediterranean” and explicitly linked this with reducing dependence on Russia. He described Israel as “a friend”, a “fundamental partner” and said he hoped there could be further cooperation. 

The visit is another sign of the increasing ties between the EU and Israel. Von der Leyen praised Israel’s close co-operation in helping the EU’s Covid-19 vaccination programme, and her office pointed to Israeli agricultural know-how to help alleviate food shortages caused by the Russian invasion of Ukraine. Its desalination expertise was developed partially with funding from the European Investment Bank and Israel is a member of the EU’s Horizon Europe scientific research programme.

And what of Russia? It will not take kindly to Israel stepping in to help the EU. Relations are already difficult. Moscow was angered when Israel condemned Russia’s invasion, calling it a “flagrant violation of the international order” and it voted for the suspension of Russia from the UN’s Human Rights Council. Moscow described the moves as “anti-Russian attacks” designed to distract attention from the Israeli/Palestinian conflict. A new low came when Russia’s Foreign Minister said “Hitler had Jewish blood’. A few weeks later, Moscow welcomed a Hamas delegation to Russia where delegates not only met Russia’s Deputy Foreign Minister Mikhail Bogdanov, but also, reportedly, the Chechen leader and warlord, Ramzan Kadyrov.

Russia and Israel must now weigh their next moves. They need each other for deconfliction measures in Syria where each side is fighting, and neither wants a breakdown in relations. If Russia seeks to punish Israel for helping the EU it can further distance itself, dial up the rhetoric, and begin to help Israel’s enemies. But that comes with risks. It would end any slim hopes Russia has of replacing the Americans as the interlocutor between the Palestinians and Israelis, and more seriously could push Israel into giving in to US pressure and begin supplying Ukraine with advanced weaponry. Following Lavrov’s Hitler remark, an Israeli political/military delegation showed up at the US Airforce base at Ramstein in Germany to discuss doing just that, but as far as is known no decisions were made.

While Israel has no desire to fall out with Russia, with the EU offering a huge market for its abundant energy supplies, it’s probable that if forced to choose, it will choose Europe. And the EU, which for decades took the easy route of cheap Russian energy, has at last made the connection that the pipelines were actually handcuffs and that the easy choices are not always the best.