Prime Minister Benjamin Netanyahu’s government has approved a $35 billion agreement to export natural gas to Egypt, making it the largest-ever deal of its kind in Israel’s history. On Wednesday, Israel signed an agreement to this effect with the U.S. oil company Chevron and its Israeli partners.
The multi-billion-dollar deal resoundingly shatters the narrative of the anti-Israel boycott (BDS) and the myth of the country’s diplomatic and economic ‘isolation’ in the Middle East, let alone the world.
Under the deal, Egypt will receive shipments from Chevron’s Leviathan field, a large underwater gas reserve off the coast of Israel. “The gas deal (…) is expected to see up to 130 billion cubic meters of natural gas supplied from Israel’s Leviathan field to Egypt through 2040 under contracts with Chevron and its partners,” the Israeli TV channel i24NEWS reported.
Reuters reported the details of Israel’s largest-ever gas deal:
Israel signed the export agreement in August with Chevron and its partners, NewMed, opens new tab and Ratio, to supply up to $35 billion of gas to Egypt from the Leviathan natural gas field.”I have today approved the largest gas deal in Israel’s history. The deal is for 112 billion shekels ($34.67 billion),” Netanyahu said in a televised statement.He added that the deal, which had been held up over some outstanding issues, would help secure stability in the region.It should ease an energy crisis in Egypt, which has spent billions of dollars importing liquefied natural gas since its own supplies fell short of demand. (…)Under the deal, Leviathan, which has reserves of some 600 billion cubic metres, will sell about 130 bcm of gas to Egypt through 2040 or until all contract values are fulfilled, said NewMed in a statement.
Prime Minister Netanyahu compared Israel’s offshore energy reserve to the ‘miracle of oil,’ the story that led up to the Jewish festival of Hanukkah, which is being observed this week. The Times of Israel reported the prime minister’s statement:
“The agreement is with the American company Chevron, with Israeli partners who will supply gas to Egypt,” Netanyahu said.“This money will strengthen education, health, infrastructure, security, the future of the coming generations,” said Netanyahu, adding that he only approved the deal, which was held up in October, after he had ensured that it met Israel’s vital needs, including security.“The deal greatly strengthens Israel’s position as a regional energy superpower, and contributes to regional stability,” argued Netanyahu, adding that it would encourage other countries to search for gas in Israel’s waters. (…)
“We have brought another jug of oil to the nation of Israel,” Netanyahu said, in a reference to the story of this week’s Hanukkah holiday, in which one small jug of oil found in the ancient Temple supposedly kept the menorah lit for eight days.
As the two-year war against Hamas winds down, Israel appears to be using the energy exports as leverage with Egypt, which also shares a border with Gaza. “The approval of this gas agreement is a historic moment for the State of Israel, both in the security-diplomatic sphere and the economic sphere,” Israel’s Energy and Infrastructure Minister, Eli Cohen, said. “Natural gas is a strategic asset for the state.”
The deal seeks to bolster Israel’s relations with Egypt — the most populous Arab country — and counter Qatar’s growing influence in the region. The newspaper Israel Hayom observed that “Israel traded energy for leverage, binding Cairo to its gas while securing strategic calm despite unresolved violations in Sinai.”
“In Israel, officials believe that once gas deliveries begin and Egypt becomes energy-dependent on Israeli gas, this dependence will serve as leverage to deter Cairo from violating the peace treaty,” the Israeli daily added. “They also argue that had Israel not supplied Egypt with gas, its southern neighbor would have turned to Qatar.”
The bilateral energy deal comes amid President Donald Trump’s diplomatic efforts to strengthen the Abraham Accords, which aim to normalize relations between Israel and the Arab states, initiated during his first term. According to Israeli media reports, the White House played a ‘significant role’ in bringing about the agreement. “The US administration has reportedly urged Israel to finalize the agreement, with the hope that it could facilitate a meeting between Netanyahu and Egyptian President Abdel Fattah al-Sisi under the auspices of US President Donald Trump,” the Jerusalem Post reported on Wednesday.
Explain the strategic significance of the deal, the Israeli news website Ynetnews commented:
The gas export agreement (…) would create a vital economic interest shared by both countries. The deal promises practical cooperation on gas transportation and related aspects, forming a long-term interdependence between Jerusalem and Cairo.Israel has previously signed gas agreements with both Egypt and Jordan, though pipelines running through the Sinai Peninsula were repeatedly targeted and blown up by ISIS.The significance of the new deal — particularly due to the vast export volume — lies in Egypt’s heightened incentive to accommodate Israeli interests, including in areas beyond energy. With Israel likely to engage with Egypt in managing postwar Gaza as early as next year, the agreement is seen as fostering a favorable atmosphere for broader cooperation.The route of the gas infrastructure will be key. Given past experiences, it is expected that the pipeline will run undersea rather than through Sinai. This comes amid growing concerns in Israel over Egypt’s military buildup in the peninsula — a move that violates the peace treaty between the two countries.
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