Eastern Mediterranean countries were eager to engage in building a common energy market and invest in infrastructure at the beginning of the year. However, Covid-19 has brought their plans to a halt. The economic repercussions of Covid-19 and the consequences for global energy prices have led to drastic reconsiderations by governments and private investors on cost-intensive energy infrastructure projects. The potential to boost regional cooperation by means of this energy integration has been equally diminished. As the developments surrounding Covid-19 make the energy component far less reliable, the approaches of Eastern Mediterranean countries now focus on security cooperation to deal with contest and threats — a trend that will lead to additional securitisation in the Eastern Mediterranean basin.
Geopolitically situated in between energy-rich Gulf countries and energy-hungry European countries, Eastern Mediterranean countries have mainly had a transit function and were dependent consumers.
To understand the impact of Covid-19 on the security structure in the area, one has to look into the regional developments concerning energy. Geopolitically situated in between energy-rich Gulf countries and energy-hungry European countries, Eastern Mediterranean countries have mainly had a transit function and were dependent consumers. Yet, the major natural gas field discoveries in the 2000s and 2010s presented Cyprus, Israel and Egypt with a real game changer for the region. The island of Cyprus, which is a member of the EU since 2008, doesn’t have a connection to electricity or the pipeline grid of mainland Europe and has thus exclusively imported its energy via sea. After the discovery of the Aphrodite gas field (6 trillion m³ natural gas) in 2011, the country now stands to become an energy provider. Israel — in the past believed to be a land without natural resources and geopolitically isolated for most of its short history due to the conflict with the Palestinians and a whole array of other issues with its neighbors — was blessed with an estimated gas reserves of 800 billion to 1 trillion m³. Egypt, which already had its own oil and gas industry, has grappled to satisfy its continuously rising domestic energy demand. Energy sufficiency was achieved only after the Zohr gas field (850 billion m³) was discovered in 2019. The already existing gas liquefaction terminals are putting Egypt in the position to become an important energy hub for the region.
With the hope to avail themselves of the new-found energy riches, Egypt, Cyprus, and Israel went to look for a buyers’ market and found it near Greece, Jordan and the Palestinian Authority (PA). Together these countries founded the Eastern Mediterranean Gas Forum (EMGF) in early 2019, to coordinate gas trade, set prices, align energy policies, merge infrastructures and thereby secure energy supply. This trans-regional forum is special in several respects, bringing together Israel and PA, Egypt and Jordan for a sole purpose of converging national interests around energy cooperation. The existing security cooperation between some of these countries (Israel and Egypt or the PA) supported and in some cases facilitated cooperation on the energy market in an otherwise difficult diplomatic climate.
However, in January 2020, the Covid-19 virus changed the setup dramatically. Greece, Cyprus and Israel had just signed a deal to realise the EU-funded EastMed pipeline (aimed to connect Israel and Cyprus to Greece and thereby to the EU pipeline grid) when China ordered the Wuhan region to go to full lockdown. The economy in the area, which is a transport and industry hub, came to a near halt and China’s ever-growing economy was severely affected. As the economy lay idle for weeks, energy demand for the entire country tumbled, an effect that globally spread as quickly as the virus itself. The International Energy Association quantifies the decline in energy demand as 25 percent per week for countries in full lockdown and a weekly average of 18 percent for countries in partial lockdown.
In January 2020, the Covid-19 virus changed the setup dramatically. Greece, Cyprus and Israel had just signed a deal to realise the EU-funded EastMed pipeline (aimed to connect Israel and Cyprus to Greece and thereby to the EU pipeline grid) when China ordered the Wuhan region to go to full lockdown.
This fall in demand naturally drove global energy prices down. In combination with the Russia-Saudi Arabia oil price war of March 2020, the global price drop was even further catalysed. Due to the Covid-19-induced fall in energy demand, Saudi Arabia requested Russia to diminish its oil production as a price regulation mechanism. When Russia refused, Saudi Arabia increased its oil production as well and thereby initiated a zero-sum race in which no one wanted to give in. The short economic war was resolved by OPEC+ but the additionally produced oil that would have typically lowered world prices and could have been offset or curbed by an increase in demand now coincided with the corona-induced disappearance of global energy demand. This oil glut ultimately led to the historic first of a negative oil price for future May trades.
These developments squandered the potential for the emerging energy market in the Eastern Mediterranean. Trust in the energy sector is harmed, the future of the EastMed pipeline is unclear and the EMGF has lost its drive. The latter is especially important, since the EMGF does not only bear weight in respect to energy, but it is also a balancing effort against Turkey’s influence in the region.
Turkey, which sees itself as a regional power, is an energy hub between Russia, Iran, energy-rich countries like Azerbaijan, and Europe. However, it remains without any noteworthy energy resources and feels threatened by the aspiring energy players in the EMGF. While energy cooperation with Israel would initially have been an option for Turkey, bilateral relations were cool during the last years and caused Israel to approximate itself to Greece and Cyprus instead. Against the backdrop of the Cyprus dispute, which put Greece and Turkey against each other ever since the Turkish invasion of North Cyprus in 1974, the energy-related ambitions of Cyprus and its allies marginalises Turkish interests on the regional energy market. Turkey’s goal is national energy security and reduction of import dependence. Due to this Turkey went ahead to drill for gas on the shores of the disputed Turkish Republic of Northern Cyprus and made a maritime agreement with Libya in late 2019 that created an exclusive economic zone (EEZ) between the two countries all across the Mediterranean intended to stop pipeline projects in the region. The EU has threatened sanctions over Turkish drillings within the sea boundaries of EU member state Cyprus and also denied accepting the legally doubtful Libyan-Turkish EEZ.
Against the backdrop of the Cyprus dispute, which put Greece and Turkey against each other ever since the Turkish invasion of North Cyprus in 1974, the energy-related ambitions of Cyprus and its allies marginalises Turkish interests on the regional energy market.
As Covid-19-related economic repercussions have rendered the unifying, cooperation-creating element of a common energy market in the Eastern Mediterranean (temporarily) redundant, the regional hegemony is still contested by a cornered Turkey, the second underlying principle of cooperation — that of security — is reemerging. One sign of the securitisation is Egypt’s declaration on 11 May to form an “anti-Turkey alliance,” which officially includes Greece, Cyprus, the UAE and France, and aims to counter Turkish excavations in the Mediterranean as well as provocative fly-overs by Turkish airplanes. Egypt, which also likes to be seen as the initiator of the EMGF, now resorts to another transnational consortium to balance Turkey. However, this time it bears a clear message for a heightened security instead of an energy forum. Another sign of securitisation is for example Israel’s ballistic missile test on 2 June. Conducted offshore due to “safety concerns,” the high precision missiles destroying two floating targets was actually a show of Israeli maritime capabilities.
Turkey will most likely remain drilling for oil and not sway from its energy-related approach to regional dominance, but the concerted energy-based effort of the other Eastern Mediterranean countries has been impeded by the Covid-19 pandemic and it seems that, as energy cooperation loses its traction, securitisation of the Eastern Mediterranean is poised to increase.
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