Energy Bedfellows

10.11.13

Israel Looks to Eurasia to Achieve Top Energy and National Security Goals

Israel may be part of the Middle East regional dynamic, but one particularly noticeable trend in its foreign policy over the past few years has been the government’s overtures across the Mediterranean Sea in Eurasia. Two of Tel Aviv’s foreign policy and national security priorities—containing Iran and ensuring a hospitable environment for future natural gas exports—essentially depend on cooperation with states all over the continent, from Cyprus to Turkmenistan. Between official exchanges, partnerships, and agreements, Israel has certainly upped the ante on Eurasian relations in order to further its own interests.

The new darling of Israeli foreign policy is, without a doubt, Cyprus. Its offshore territory is part of the hydrocarbon-rich Levant Basin. Like Israel, it is seeking to exploit its own natural gas discoveries, seen as the government in Nicosia’s way out of the Euro crisis. In order to make the export of liquefied natural gas (LNG) financially lucrative, however, Cyprus also needs to receive gas from Israel’s Leviathan field. Nicosia has been aggressively courting Tel Aviv to this end. As an export option, Cyprus is a strategic ally not only because of its availability, but also because it would serve as a gateway to Europe.

The discoveries of the Tamar offshore field in 2009 and Leviathan in 2010 prompted the two countries to sign the Agreement on the Delimitation of the Exclusive Economic Zone (EEZ). Official foreign exchanges began in 2011 and have become regular. Prime Minister Netanyahu and President Peres have each been to Cyprus twice, and Tel Aviv has hosted former Cypriot President Demetris Christofias as well as current President Nicos Anastasiades, when he was still leader of the opposition. The energy ministers from both countries have also engaged in several exchanges.

But this dynamic bilateral relationship does not stop with cooperation on natural gas issues. In September, Knesset Speaker Yuli Edelstein and his Cypriot counterpart signed a protocol for cooperation, and Edelstein expressed his hope for “further economic cooperation and greater trade and investment in Cyprus.” Israel and Cyprus are also engaging in public diplomacy. Last month, Cypriot foreign minister Ioannis Kasoulides presided over the signing of an agreement between the University of Cyprus and the Israeli Embassy in Nicosia for the creation of a Jewish studies program at a local university.

Energy concerns have also driven Israel to strengthen ties to Greece. A Cyprus-based group that includes the Public Power Corporation of Greece plans to implement the EuroAsia Interconnector project, a subsea power cable linking Israel, Cyprus, and Greece. That agreement was inked in August as part of a tripartite energy memorandum of understanding, which also provides for trilateral cooperation on the protection of natural gas fields. Annual Israeli-Greek joint military exercises have also included defending offshore natural gas platforms.

One issue that could become a sticking point, however, is Greece’s desire to ease sanctions on Iran. Netanyahu met with Greek Prime Minister Antonis Samaris last week to make the case against such a move. The discussions between the two delegations marked the first ever Israel-Greece government-to-government meeting.

The prospect of a nuclear Iran has also encouraged Israel to solidify relations with the Caspian countries. Turkmenistan, for example, is geostrategically important to Israel because, “From a hotel in Turkmenistan’s capital of Ashgabat, according to a saying in Jerusalem, one can see into Iran.” Netanyahu met Turkmen Foreign Minister Rashid Meredov in New York during the United Nations General Assembly at the end of September, just three months after Turkmenistan finally accredited an Israeli ambassador. During a conflict that lasted for years, Ashgabat rejected two candidates for “allegedly being spies interested in…collecting intelligence information on Iran.” Tehran has been actively working against Israeli-Turkmen relations, but Turkmenistan has fiercely asserted its neutrality.

Azerbaijan and Israel do cooperate on gathering intelligence on Iran and claim to have “thwarted several attacks by Iranian agents,” but the intensification of bilateral cooperation is “largely independent” of the threat from Tehran. Energy security, rather than a nuclear Iran, is the driving force. Baku, which provides 40 percent of Israel’s oil needs, is its top oil supplier. Meanwhile, a subsidiary of Azerbaijan’s state oil company is involved in hydrocarbon exploration off Israel’s coast.

In return, Israel has become a major player in Azerbaijan’s defense industry. Israeli contractor Aeronautics opened a UAV (unmanned aerial vehicle, or drone) factory there in 2011, and a deal worth $1.6 billion signed in 2012 provided Israeli arms and military expertise to Baku. Regardless of whether or not this is a concerted move by Israel to balance Iran, it does send a signal to Tehran that its Caspian neighbor values Israel’s defense industry clout.

Israeli engagement in Eurasia is definitely picking up speed. While it does not represent a defined pivot or shift away from other foreign policy and national security interests, it does indicate an understanding that these countries will be important to effectively realize those interests. And Tel Aviv’s efforts, it seems, are paying off.