The East Mediterranean Gas Forum, based in Cairo and hosted by the Egyptian Ministry of Petroleum and Mineral Resources, saw Egypt, Greece, Israel, Jordan, Cypress, and Italy agree to improve diplomatic relations in the region.
The forum provides collective power to the nations as they attempt to move into the highly-competitive global oil market.
For Israel, the agreement is also an attempt at improving dialogue between neighboring Arab states.
“[This deal] brings regional cooperation with Arab and European countries, the first of its kind in history, with contracts to export (Israeli) gas to Jordan and Egypt worth $30 billion, and that is just the beginning,” said Israeli Energy Minister Yuval Steinitz in a statement.
The agreement comes amid high-profile diplomatic peace agreements between Israel and several Middle Eastern nations, including Bahrain, with whom Israel agreed to fully normalized relations.
"This is a new era of peace. Peace for peace. Economy for economy. We have invested in peace for many years and now peace will invest in us," Israeli Prime Minister Benjamin Netanyahu said.
The move is widely seen as a blow to Turkish president Recep Tayyip Erdoğan’s efforts to expand Turkish fossil fuel leadership in the area.
Egyptian president Tariq El-Molla’s announcement that the discovery of 320 trillion cubic feet of gas in the Eastern Mediterranean could turn the EMGF into a global contender, allowing the countries collective power and the ability to offer competitive pricing.
"The EMGF is expected to influence the realization of the full potential of the region and reflects the desire of many parties and international organizations to support its activities," Egypt’s Ministry of Petroleum and Mineral Resources said in a statement.
The global oil industry produces over four billion metric tons of oil annually and is worth over $1.7 trillion, making it one of the world’s largest and most competitive markets. Additionally, the annual value of global oil production has been steadily rising as global demand increases.
However, the coronavirus has had a disastrous effect on the global oil exploration and production industry, leading to a projected loss of almost $1 trillion in 2021.
The Middle East is expected to bear a heavy cost due to the coronavirus, with estimated losses approaching $300 billion.
The EMGF is expected to further shake up the oil industry, with its regional alliances marking both the dawn of a new era with the diplomatic union of six Mediterranean nations and the exacerbation of already dismal relations between several member states and Turkey.
In August, a Turkish frigate searching for undersea oil collided with a Greek ship monitoring foreign presence in the Aegean. Following the event, Turkish president Erdoğan vowed that “if this goes on, we will retaliate. We shall not leave either the dead or the living of our kin alone.” Soon after, France (a NATO ally) deployed two fighter jets and two warships to the area.
The collision marks a new flareup in a decades-long dispute over oil and land interests in the Mediterranean.
Since 2009, international oil companies in the Mediterranean have discovered oil fields large enough to make whole countries self-sufficient and able to export the oil to foreign markets. The discoveries are an important bargaining chip to Israel, who plans to unite with Greece and Cyprus to create a massive pipeline intended to move between nine and 12 billion cubic yards of oil to Europe.
The agreement is complicated by the fact that while Greece and neighboring countries have spent large amounts of time and resources searching for oil deposits in the region, Turkey has done the same in areas that Greece regards as its own.
Turkey condemned the agreement, citing alleged Greek disregard for the northern region of Cyprus, which is primarily occupied by Turkish Cypriots.
"Any project which aims to ignore Turkey with the longest coastline in the eastern Mediterranean and aims to ignore Turkish Cypriots who have equal rights over the natural sources of the Cyprus island will not be successful," the Turkish Foreign Ministry said in a statement.
Greece’s bid for Mediterranean oil is a chance at economic growth after sinking into financial ruin in 2008. The bid will not come easy, however, and the Turkish Foreign Ministry’s statement threatened that closing Turkey out of the agreement would mean failure for the project.
"Those who try to close the 'gates of cooperation' for both to us and to Turkish Cypriots clearly are some countries that are in pursuit of vicious political purposes rather than cooperation,” the statement read. “We remind the project owners that such dirty purposes will not hold in the future as they were not successful in the past."
Some experts, including Panos Papanastasiou, engineering professor at the University of Cyprus, doubt that the project will come to fruition.
“I do not think it will happen soon. This is not a very mature project,” he said.
For East Mediterranean Gas Forum member states, the coalition is an important one, and their union is a crucial opportunity to expand. However, such an expansion will not come without diplomatic tension.
About the Author
Elijah Labby is a graduate of the National Journalism Center. He has previously written for Broadband Breakfast, a technology and internet policy website.