V ery provocative.” “A big aggression.” These are the words Israeli and Lebanese officials have used in the last few weeks when referring to potential oil and gas reserves in the Mediterranean Sea. Lebanon recently issued exploration tenders, including in an area known as Block 9 that straddles disputed territory between the two countries. The maritime border between the two countries remains contested.
Block 9 is “the most promising of Lebanon’s reserves,” says Tareq Baconi, a visiting fellow at the European Council on Foreign Relations.
Israeli Defence Minister Avigdor Lieberman, a right-wing member of Prime Minister Benjamin Netanyahu’s security cabinet, caused anger in Beirut when he said last week that international oil companies were making a “grave mistake” to participate in exploration bids in an area that belongs to Israel. He did not specify which exact area he referred to.
The Lebanese government quickly fired back, with President Michel Aoun and Foreign Minister Gebran Bassil calling the comments a “direct threat to Lebanon.” Prime Minister Saad Hariri said Israel’s claims were not valid and part of policies to “threaten regional security.”
This is far from the first time the two sides have exchanged threatening rhetoric - they are technically still at war. Lebanon, home to several hundred thousand Palestinian refugees, has not recognised Israel.
Can an ‘economic peace’ work?
Lebanon is not the only country that could benefit from potential gas reserves in the Mediterranean. Egyptian authorities recently announced that they would complete the development of the Zohr gas field at the beginning of 2019, around one year ahead of schedule.
As news of the discovery of more energy reserves in the eastern Mediterranean spread around the region, many highlighted the prospect of greater regional stability as a result of deeper economic integration between eastern Mediterranean states. The “economic peace” idea posits that economic cooperation creates trust (lacking between many countries in the region) that can help to overcome political differences. Beyond just a theorem, the idea formed the basis of a lot of diplomatic engagement by outside powers such as the US and EU when it comes to tackling the region’s tensions.
Supporters of the “economic peace” theory, Mr. Baconi noted in a recent paper, cite as evidence the ongoing flow of Russian gas to Europe during the Ukraine crisis or energy relations between the Soviet Union and West Germany during the Cold War.
However, Mr. Baconi is skeptical of how much such a strategy can achieve. “The problem arises when the ensuing stability and economic growth is taken as a sign that matters of political dispute have been resolved,” he told TWW. Throughout history, he adds, “periods of economic growth and stability have consistently been ruptured by violent outbursts precisely because underlying political injustices fail to be addressed.”
Imad Salamey, a veteran observer of Lebanese politics from the Lebanese American University, says it was “unlikely that this disagreement will be resolved anytime soon.” Mr. Baconi saw the potential for “escalation,” especially if gas was discovered in the disputed Block 9.
Instead of facilitating cooperation, “disagreements over gas reserves could rapidly provide a lightning rod through which to channel broader political disputes between the parties,” the ECFR fellow says.
The European connection
Gas and oil exploration in the eastern Mediterranean carries significance beyond the Middle East. The development of these reserves “would have a large impact on the regional and global energy market,” says Justin Dargin, a leading Middle East energy expert at the University of Oxford.
Beyond the prospect of reducing regional countries’ import dependency, “there is also the potential to restructure gas import patterns in the EU,” Mr. Dargin told TWW. Gas from the eastern Mediterranean could be a way for Europe to reduce its dependence on Russian gas. This would, however, mean competition with Russian gas on a cost basis. Moscow, he points out, would likely have a price advantage in this field.
Russia’s state-run Gazprom supplies almost 40% of Europe’s gas. In 2017, Russia exported a record 193.9 billion cubic metres of gas to European countries.
There are also other hurdles for Lebanon and Egypt. Lebanon’s gas infrastructure remains “underdeveloped” and would need significant investment in order to process and transport offshore gas, Mr. Dargin says. “The regulatory framework is still quite weak, and there are still many issues concerning the sectarian political system that cause significant deadlock in moving forward with any political consensus,” he adds. That said, the potential gas reserves would be a “significant economic boon for Lebanon.”
Gas imports from Egypt’s Zohr field “are an attractive proposition to European policymakers,” but a current gas glut means eastern Mediterranean producers “will have to compete with a world awash in gas,” according to Mr. Dargin.
“It is my belief that economic peace will only ever be lasting if it is coupled with diplomatic and political engagement to address underlying sources of conflict between warring parties,” Mr. Baconi told TWW.
Another war with Hezbollah?
This latest rise in tensions is not only rooted in the dispute over who will control potential energy reserves off the coast. This week Lebanon protested against Israeli plans to build a wall between the two countries, saying the intended barrier passes through Lebanese territory and violates the country’s sovereignty.
What is more, Israel is concerned about the growing power of Hezbollah, a powerful Shia movement which has helped turn the tide in the Syrian Civil War in favour of President Bashar al-Assad.
Speaking at a conference in Tel Aviv earlier in February, Defence Minister Lieberman talked about the possibility of going to war with Hezbollah again. “No one is looking for adventures, but if we have no choice the goal is to end [the fighting] as quickly and as unequivocally as possible,” Mr. Lieberman said.
Israeli officials believe that Iran, Hezbollah’s main backer, had resumed working on precision missile factories in Lebanon. Prime Minister Benjamin Netanyahu recently told Russian President Vladimir Putin that this was a threat Israel was not willing to accept.
The two sides fought a 34-day war in 2006, which led to the deaths of 121 Israeli soldiers and over 1,100 people in Lebanon, including at least 250 Hezbollah fighters. At the time, Lebanon’s official army largely refrained from directly attacking the Israel Defence Forces (IDF). However, Israeli officials like Mr. Lieberman are increasingly insisting that the two were now undistinguishable.
Israel invaded southern Lebanon during the Lebanese civil war in 1982 and used local allies to build a ‘security belt’, which remained in place until the IDF withdrew in 2000. Hezbollah launched many attacks against the IDF and Israel’s local allies, the South Lebanon Army.
With fighting in some parts of Syria winding down, there has been speculation that Hezbollah could soon turn its attention back to confronting Israel. “The possibility of an Israeli-Hezbollah armed conflict remains high given escalating rhetoric,” Dr. Salamey told TWW. Despite the Lebanese-Israeli maritime disputes, he adds, it was the Syrian front that “remains of utmost security priorities to both sides.”
The Israeli air force this week targeted a military site in the Damascus countryside, according to the Syrian government. The Syrian Observatory for Human Rights, a UK-based monitoring group, reported that the strikes hit the Jamraya area. The West suspects a scientific facility in the vicinity is being used as a chemical weapons productions site. Israel did not comment on this week’s reports but stated in the past that it has carried out strikes to prevent advanced weapons transfers to Hezbollah.
Shortly before TWW went to press, Lebanese President Aoun said talks about the border wall and energy reserves were being conducted through the UN and “friendly states” to prevent what he called “Israeli greed.” Keeping in line with previous rhetoric, Mr. Aoun vowed that Lebanon “will confront any attack” on the country’s territory or waters.
While Israel’s relations with other Arab countries have improved over the last few years, similar moves remain a distant prospect for cooperation with Lebanon.