Netanyahu Announces Historic Israel–Egypt Gas Deal

Israeli Prime Minister Benjamin Netanyahu has announced a major natural gas export agreement with Egypt, describing it as the largest gas deal in Israel’s history. Valued at approximately $34.6 billion, the long-term agreement significantly expands Israel’s role as a regional energy supplier and reinforces strategic cooperation with Egypt amid a complex political environment.

Details of the Gas Agreement

The deal involves Israeli energy company NewMed Energy supplying additional natural gas to Egypt over the lifetime of the contract. Under the agreement, total gas exports from Israel to Egypt are expected to reach around 130 billion cubic metres. Although NewMed Energy disclosed the commercial signing earlier, Netanyahu’s televised address framed the deal as a national economic and strategic milestone. The gas will primarily originate from Israel’s offshore Mediterranean fields and be transported via existing pipeline infrastructure.

Economic Significance for Israel

The agreement is expected to generate substantial state revenues and strengthen investor confidence in Israel’s offshore energy sector. Israeli officials have indicated that proceeds from gas exports will support public spending priorities, including education, healthcare, infrastructure development, and national security. The deal also provides long-term regulatory clarity, which is critical for attracting further foreign investment into exploration and production activities in the Eastern Mediterranean.

Regional and Strategic Implications

Beyond economics, the agreement reinforces Israel–Egypt energy cooperation at a time of broader regional instability. Egypt serves as a key gas hub, liquefying Israeli gas for domestic use and potential re-export. The deal adds an economic layer to the longstanding peace treaty between the two countries, signed in 1979, despite the absence of frequent high-level public meetings between their leaders in recent years.

What to Note for Exams?

• The Israel–Egypt peace treaty was signed in 1979.
• NewMed Energy is a major Israeli natural gas producer.
• The Eastern Mediterranean has emerged as a key gas-producing region.
• Natural gas exports are a major source of foreign revenue for Israel.

US Influence and Diplomatic Context

Reports indicate that the timing of the agreement is linked to diplomatic engagement by the United States. Washington is seen as encouraging closer regional cooperation, including potential summits and expanded economic ties under broader Middle East peace initiatives. Netanyahu is expected to discuss regional energy and security issues during an upcoming visit to the United States, underscoring the deal’s political as well as commercial significance.