Energy and Our World

This article originally ran on Forbes.com on October 2, 2024. All rights reserved.

Daniel B. Markind is a Forbes.com energy column contributor. The views expressed in this article are not to be associated with the views of Flaster Greenberg PC.

With the whole world watching events in Lebanon to see if Israel next launches a threatened ground invasion into that country, following its recent “culling” of the entire Hezbollah high command, another area that bears watching  concerns what will now happen to the Israel/Lebanon natural gas deal reached in 2022 that, for a time, held a glimmer of hope for eventual peace in the Middle East, or at least between these two countries. (Source).

For those who may not recall that deal had demarcated the maritime border in the Mediterranean Sea between the two countries and gave Israel full rights to the “Karish” gas field and Lebanon most rights to the “Qana” field, with some revenue from the latter to go to the Israelis.

Recently, Israeli government officials have been broaching the idea of “finding a loophole” to invalidate the gas agreement.  Even more recently, Israeli Energy Minister Eli Cohen openly called the deal a “mistake” and urged it to be rescinded. (Source).  

From the time it was signed, many in Israel thought the gas deal was merely a giveaway - that Israel had basically just accepted Hezbollah’s position on where to demarcate the maritime border - and that Israel had gotten very little from it, especially considering that the deal, by itself, did nothing to resolve the decades of hostility between the two countries.  Since October 8, 2023, when Hezbollah began firing over 9000 rockets into Israel, ostensibly in support of Hamas in Gaza, calls in Israel’s energy sector have been growing to declare the agreement invalid.  Since Israel started aggressively hitting Hezbollah two weeks ago with the now infamous “pager attack,” those calls have now reached ministerial level.

Israel’s critics claim that cancelling the deal would fit a decades long pattern of “Israeli expansionism,” and that Israel really wants to take all the disputed gas fields for itself. However, given the mood in Israel following the October 7, 2023, massacre, and the Hezbollah rockets, that criticism likely will fall on deaf ears.  As TotalEnergies, the French energy consortium, is one of the developers of the Lebanese gas field, Israel might be prepared to scuttle that development as retaliation for what it perceives as untimely actions and certain comments on the situation by French President Emanuel Macron that are perceived, at least to some in Israel, to be pro Lebanese in nature.

Of course, such a move by Israel would come with substantial risks, both domestically and internationally.  For one thing, it could make the Jewish State seem less reliable in its agreements and international business affairs generally.  That could be economically devastating for a small country with a very limited domestic market.  It also could make it more difficult for Israel to develop and find markets for its own natural gas in the future, with further unknown consequences.

In any event, the natural gas story is worth watching for any student of the Middle East or those whose lives are wrapped up in it.  As events may continue to deteriorate, natural gas exploration on the Israeli/Lebanese maritime frontier, having once so promising a future for those who earnestly want to see the fighting and hostility replaced by a lasting peace, looks like it may become another casualty of the seemingly endless regional instability.  One can only hope that, in the future, after a time when cooler heads and economic realities may eventually prevail, it will be among the first symbols of regional restoration as well.