U.S. Fear of Putin, Erdogan Spells End of Israel's Natural Gas Pipeline to Europe

U.S. says it doesn’t want to anger the leaders of Russia and Turkey by going ahead with the EastMed project; Israel has no choice but to comply

Israel Fisher
Israel Fisher
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Workers are seen at the construction site of the Nord Stream 2 gas pipeline, near the town of Kingisepp, Leningrad region, Russia , June 5, 2019.
Workers are seen at the construction site of the Nord Stream 2 gas pipeline, near the town of Kingisepp, Leningrad region, Russia , June 5, 2019. Credit: ANTON VAGANOV / REUTERS
Israel Fisher
Israel Fisher

In 2020, then-Energy Minister Yuval Steinitz promised that Israel and Greece would jointly establish the EastMed gas pipeline at a cost of 6 billion euros. Last week, it turned out that what looked at the time to be no more than happy talk was indeed unfeasible after the United States poured cold water on the project.

There are three main reasons for its failure: economic, environmental and, most importantly, geopolitical.

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In July 2020, the government, with the support of U.S. President Donald Trump, authorized the establishment of the EastMed pipeline. The goal of the pipeline was to create a natural gas supply route from Israel to Cyprus and onto Europe, with the aim of reducing European dependence on Russian gas. The project gained momentum after Turkey, the largest gas consumer in the region, said it had no interest in buying gas from Cypriot or Israeli reserves.

Israeli, Greek and Cypriot officials sign a deal to build the EastMed subsea pipeline to carry natural gas from the eastern Mediterranean to Europe, at the Zappeion Hall in Athens, in 2020.Credit: חיים צח / לעמ

The pipeline is planned to be 1,900 kilometers long, with 550 kilometers overland and 1,350 kilometers under the Mediterranean Sea. Its capacity is planned at 10 billion cubic meters of natural gas per year with an option to double that figure. Originally, the pipeline was supposed to be up and running by 2025, but it is clear that if it is built, it will be completed long after that date.

Last week, a report surfaced that the American administration sent the Greek government a letter expressing concerns about the project due to economic and environmental reasons. However, behind the scenes, it is tension with Russia, the largest gas supplier to Europe, that is dictating events. Another factor is the desire to reconcile relations with Turkish President Recep Tayyip Erdogan, who is opposed to the pipeline, while the United States needs his support due to the crisis in the nuclear talks with Iran.

Dependence on Russia

In recent months, Europe has been suffering from an energy crisis that has seen natural gas prices soar and led to a massive rise in the cost of electricity. At the same time, Russia, the largest supplier of natural gas to Europe, has allowed prices to go up because of geopolitical reasons. As a result, Europe seeks to diversify its sources of energy, a factor that adds to the feasibility of the project. A pipeline that will bring Israeli gas to Europe could anger Russian President Vladimir Putin, who would lose some of his customers. Even though the amount of gas that Israel could supply to Europe is minuscule compared to the needs of countries on the continent, a project of this nature would influence the arm-wrestling between Moscow and Washington.

Greek Prime Minister Kyriakos Mitsotakis and then-sraeli Prime Minister Benjamin Netanyahu attend a joint news conference following the signing of a deal to build the EastMed subsea pipeline, in 2020.Credit: ALKIS KONSTANTINIDIS/ REUTERS

Even though gas prices in Europe are high at the moment, they could drop sharply to 2020 levels. Thus the grandiose project would lose its economic viability. Moreover, Israel which exports gas to Egypt and Jordan is also planning to construct an additional pipeline to Egypt in order to increase gas exports to the country, Therefore, even if there was room for a pipeline to Europe, it is not at all certain that Israel has enough gas to supply the continent – assuming that Jerusalem needs to maintain its energetic security for the coming decades.

Another issue lurking in the background is the environmental issue which is becoming more pressing with every day that passes. Europe wishes to lead the world in shifting to renewable energies and U.S. President Joe Biden has declared a goal of zero carbon emissions for the U.S. by 2050. Even though Europe recognizes natural gas as a less polluting alternative than coal, it still emits large amounts of greenhouse gases.

Israel has not yet officially reacted to the U-turn made by the American administration on the EastMed pipeline, but according to a senior source knowledgeable about the project, the administration’s announcement could enable Israel to back out of the project which is not. compatible with environmental goals declared by Prime Minister Naftali Bennett with regard to zero emissions. On the other hand, according to the same source, Israel does not wish to be seen as giving in to American dictates on gas policy and economic ties with Europe, especially as at this moment, it is still committed to the issue

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