Daily Newsletter

16 October 2023

Daily Newsletter

16 October 2023

Fall in Israeli gas supplies to Egypt risks onward impact in Europe

In the wake of the conflict, Israel has shut down production at the offshore Tamar gas field, which is operated by Chevron.

Shivam Mishra October 11 2023

Gas exports from Israel to Egypt have decreased by 20% because of the closure of a key offshore field, reported Bloomberg.

Last week, Hamas, a Palestinian militant group, launched an assault on Israeli territory.

In the wake of the conflict, Israel shut down production at the offshore Tamar gas field, which is operated by Chevron.

According to officials, Egypt's daily imports of Israeli gas from the Tamar field in the Mediterranean fell to roughly 650 million cubic feet per day.

The development has compromised Egypt’s onward liquefied natural gas (LNG) deliveries to Europe, forcing Cairo to assess the impact on its LNG export plans.

Leviathan, which is said to be Israel’s largest gas field, is still operating normally, Chevron said earlier this week.

Besides catering to Israel’s energy needs, gas from Tamar and Leviathan is also exported to neighbouring countries Egypt and Jordan.

In addition to the gas from Israel, Egypt exports gas from its own fields including the Zohr field.

Located around 25km from the city of Ashdod, the Tamar platform is within the range of rocket firing from the Gaza Strip.

Israel's intention to become a significant regional supplier is currently threatened by the closure of the Tamar field.

In an effort to further solidify relations with its neighbour, Israel said in August that it would increase gas exports to Egypt from the project.

The resources' proximity to Europe was a crucial advantage for Chevron, which acquired them through the acquisition of Noble Energy in 2020.

Moscow's invasion of Ukraine in 2022 further highlighted the asset’s importance by forcing a shift away from Russian pipeline gas towards LNG.

Israel is focusing on expanding the Tamar project and exploring more Leviathan prospects, some of which may involve a floating LNG export facility.

Due to their increasing reliance on alternatives to Russian pipeline flows, particularly during the winter heating season, buyers in Europe may see a decrease in imports as a result of the shutdown at Tamar.

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