In an abrupt about-face of policy, acting prime minister and finance minister Ehud Olmert is seeking to buy natural gas from Britain. The gas would derive from an offshore field British Gas has developed in partnership with the Palestinians: the Prime Minister's Office under Ariel Sharon had prohibited buying from them.

At present Israel's sources of natural gas are the Tethys Sea consortium, but its field is not large, and Egypt. Yesterday Olmert wrote to Gordon Brown, Chancellor to the U.K. Treasury, saying Israel would be glad to do business with British Gas.

Sharon had opposed buying Gazan gas, on the grounds that Israeli money might wind up financing terrorism. Before falling ill, Sharon had apparently changed his mind, but had taken no official steps.

Olmert's letter indicates that Israel would be of assistance, insofar as is needed, in helping BG supply Israel with natural gas.

Meanwhile, The Israel Corporation (TASE: ILCO) chief executive Yossi Rosen wrote to the director-general of the Prime Minister's Office, Ilan Cohen, saying that the dream of Egyptian for Israel is dead. The Israeli-Egyptian consortium EMG threatened this week to halt talks with all potential Israeli customers for its gas (other than the Israel Electric Corporation, with which it has a contract) because of a dispute over the prices it would charge (to customers other than the IEC).