Israel’s foreign policy mustn’t be sidelined by energy interests

Gabriel Mitchell January 2020

On January 2, Prime Minister Benjamin Netanyahu will reportedly sign an agreement to export Israel’s natural gas via the proposed EastMed pipeline via Cyprus and Greece to Europe. The accord, which will be co-signed by Greek Prime Minister Mitsotakis and Cypriot President Anastasiades in Athens, seeks to strengthen the commitment between the three Eastern Mediterranean states, as well as to remind Turkey that it is not a participant in the region’s grand energy plans.

But the summit will do little to resolve the maritime disputes that are increasingly overshadowing hopes for regional cooperation. If Israel is to unlock the potential of its offshore riches, then it must commit to reviewing its entire Eastern Mediterranean foreign and energy policies.

Foreign policy is an essential lens through which one can assess the risks and rewards of offshore energy development, and this subject deserves more serious discussion by both Israeli policy-makers and the Israeli public. Advocates of the Netanyahu government’s export plan emphasize the strategic benefits of energy cooperation with Israel’s regional neighbors, while opponents to the government plan often sidestep the foreign policy argument in favor of a discussion about the plan’s domestic consequences, particularly the marginal impact on the cost of electricity, continued monopolization of the energy market by a handful of companies, and the environmental implications of offshore drilling. Neither camp directly confronts the argumentation of its rival, thus ensuring that public debate on Israel’s export strategy remains stuck on repeat.

Yes, Israel has an opportunity to contribute to the construction of a new regional architecture in the Eastern Mediterranean, but that should not come at the expense of domestic needs and interests. Energy cooperation requires long-term planning; a commitment to building and expanding bilateral relationships with neighbors in the years to come.

This means developing a strategy that expands beyond the limited scope of gas pipelines. In order to chart an optimal course forward, Israelis must first engage in an honest conversation about the prospects of transformative change at the regional level.

Energy cooperation does not always transform into something more meaningful at the bilateral level. Look no further than Israel’s current energy ties with the Palestinian Authority, Jordan and Egypt. In all three cases, the parties benefited from a local and affordable energy stream. However, resource management and jurisdiction remain sensitive issues for Palestinians, who are seeking to reduce their dependence on Israel.

THE 2014 DEAL signed between the Tamar field partners and Jordanian-owned Arab Potash and Jordan Bromine has been met with popular resistance in Amman. Jordanian parliamentarians frequently demand that the government renege on the deal. And even the most optimistic voices wouldn’t claim that a gas pipeline will impact Egyptian public attitudes towards Israel. Israelis must also be concerned about a long-term partnership with an authoritarian regime having an uncertain future. That shouldn’t discourage diplomatic efforts to strengthen ties with regional actors, but the Israeli public needs to be realistic about the limitations of normalization, so long as the Israeli-Palestinian conflict remains unresolved. The floor for cooperation has risen, but the ceiling remains high.

The same dose of realism must also be applied to other potential energy partnerships in the Eastern Mediterranean.

It was only in 2016 that Israeli and Turkish officials cited the prospect of energy cooperation as a primary reason for patching up their bilateral differences. Though the downgrading of ties in 2010 was born out of the Gaza flotilla affair, optimism that reconciliation would lay the groundwork for future natural gas contracts appeared to be one of the primary motivations on both sides. Today, it seems implausible that Israel and Turkey would consider such a partnership – but this demonstrates the Eastern Mediterranean’s unpredictable geopolitical winds, as regional actors vie for influence over the direction of its energy flow.

One of the byproducts of strained Israeli-Turkish relations over the last decade has been the strengthening of bonds between Israel, Cyprus and Greece. After the 2010 fallout, Jerusalem’s hope was to play diplomatic “moneyball” and recreate Ankara’s strategic value in the aggregate by replacing it with other regional partners.

The tripartite relationship, or “Energy Triangle,” exemplifies one of the crowning achievements in contemporary Israeli diplomacy. Still, some in Nicosia and Athens worry about the day that Ankara decides to extend an olive branch to Israel. Will efforts to advance relations with Jerusalem over the last decade come up short if Turkey makes an offer that Israel can’t refuse? How would Israel balance a desire to rebuild ties with Turkey with its existing commitments to its Hellenic partners?

Worryingly, the signature project that Israel, Greece and Cyprus champion – the EastMed pipeline – currently lacks technical and commercial feasibility. While the European Commission is currently reviewing aspects of the pipeline’s feasibility, the decline of global energy prices and availability of cheaper options for the European market cast serious question marks on this endeavor. Based on current numbers, it is doubtful that Israeli natural gas would be competitive on the European market by the time it arrived in Italy or elsewhere in the EU. Despite the political support for the project, many in the energy industry remain skeptical.

WHICH MAKES the developments of recent months all the more concerning for Israeli policymakers. As Israel and other regional actors translated their shared energy interests into developing the Eastern Mediterranean Gas Forum – a body tasked with coordinating regional interests into the formation of cooperative energy policies and a regional gas market – Turkey has desperately sought ways of forcing itself back into the regional conversation.

Over the summer, Ankara placed drill ships at strategic positions in the Eastern Mediterranean in order to stake out its territorial claims over maritime space around Cyprus. On November 29, Turkey announces that it had reached a delineation agreement with Libya’s UN-supported government over their maritime boundaries, driving an imaginary wedge through the Eastern Mediterranean that challenges Greek and Cypriot maritime claims and could potentially threaten the region’s maritime security.

For years, Israeli officials reiterated that regional energy cooperation was not designed to exclude any other state. But as Turkey’s actions have crossed more Greek and Cypriot red lines, so has Israel joined Egypt, the European Union and the United States in criticizing Ankara. It remains to be seen whether this collection of actors is committed enough to formulating a strategy that either includes or excludes Turkey. If Netanyahu’s participation in this week’s summit is any indication, this current cycle of regional tension is far from over.

Is Israel executing an energy policy that achieves its foreign policy goals, or vice versa? Should future governments adjust these policies in the hopes of either maximizing the potential of regional energy cooperation, or out of concerns that domestic interests have been overlooked? Israelis need to ask whether their government should continue investing in these multilateral processes for the sake of national security, even if they won’t positively impact their cost of living in the immediate future (or ever), and if there is no guarantee that they will deliver additional strategic benefits.

Considering the ongoing investigations connecting the country’s political and national security elite with secondary aspects of the energy and defense industry, Israelis have just cause to remain skeptical about the motivations of their public servants and to demand greater transparency. Healthy democracies should execute foreign policies with the intention of fulfilling public interests. An open discussion that considers both the domestic and foreign policy implications of Israel’s energy policy would be a valuable first step.

The writer is a policy fellow at Mitvim – The Israel Institute for Regional Foreign Policies, and a doctoral candidate in government and international affairs at Virginia Tech University.
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