Israel Reports 25% Surge in Gas Exports to Egypt and Jordan Amidst Regional Tensions

Surge in Exports to Egypt and Jordan Signals Regional Energy Dominance Amidst Conflict

Feb 26, 2024 - 09:34
Feb 26, 2024 - 09:35
Israel Reports 25% Surge in Gas Exports to Egypt and Jordan Amidst Regional Tensions
Israel Reports 25% Surge in Gas Exports to Egypt and Jordan Amidst Regional Tensions

Israeli authorities disclosed a significant uptick in gas exports to neighboring Egypt and Jordan, showcasing a remarkable 25% increase throughout the year 2023. This surge comes despite brief disruptions witnessed at the onset of the conflict in Gaza, underscoring Israel's pivotal role in the regional energy landscape and its potential for further expansion.

According to Israel's Energy Minister, Eli Cohen, the substantial growth in natural gas exports to Egypt and Jordan highlights the strategic importance of these energy resources in fostering regional stability. Cohen further hinted at exploring avenues to broaden export channels, including potential routes to Europe through collaboration with Egyptian liquefaction plants or via the development of domestic facilities.

The Leviathan gas field, operated by Chevron in partnership with Israeli entities, emerged as a key contributor to the heightened exports, supplying significant volumes to both Egypt and Jordan. Similarly, the nearby Tamar field played a crucial role in meeting regional energy demands, albeit facing temporary production setbacks during the conflict with Hamas.

Israel's natural gas reserves, discovered in the eastern Mediterranean over a decade ago, have since evolved into a cornerstone of the nation's economic landscape. The increased gas production witnessed in 2023 has translated into record-breaking state royalties, totaling 2.19 billion shekels ($603 million).

These royalties are earmarked for Israel's nascent sovereign wealth fund, established to mitigate currency volatility arising from sudden influxes of wealth. Despite initial delays attributed to political turbulence and revenue stream complexities, the fund commenced operations in 2022, bolstered by taxes levied on profits generated from natural resources.

With projections indicating substantial asset growth for the sovereign wealth fund over the next decade, Israel is poised to harness its natural gas reserves for long-term economic stability and prosperity amidst ongoing regional tensions.

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