Are East Mediterranean Gas Resources the Solution to Europe's Energy Crisis?
The Russian invasion of Ukraine more than 6 months ago has caused a dramatic spike in natural gas prices and caused repeated energy shocks in Europe. The EU has accused Moscow of using energy as a weapon, while Russia denies this and blames western sanctions for the drop in exports. After Russian state-owned company Gazprom announced a three-day shutdown of North Stream Pipeline 1, natural gas futures linked to TTF, Europe's wholesale gas price, increased sharply to EUR340 per megawatt hour due to supply fears. Gazprom, claiming that it has problems with its turbines, has already reduced flows through the Nord Stream pipeline to about 20 percent of its capacity.
As Europe has been desperately trying to find alternative sources to cover its energy needs, and as Gulf oil and gas producers have made it clear that they are unable to substantially increase their output and cover the energy shortfall facing the European continent, the European Union and individual countries have turned their attention to the Eastern Mediterranean gas finds.
Significant quantities of natural gas were discovered in the Eastern Mediterranean mainly in Israel, Egypt and Cyprus in recent years and European leaders, who in the past did not give much attention to this, have now come to realize that the region can potentially become an alternative source to Russian gas for European countries, contributing to the diversification of Europe's energy supply route.
The sizeable quantities of offshore natural gas discovered in recent years within the Levantine Basin and further across the Eastern Mediterranean Sea can turn the region into an oil and gas production hub and supplier. Egypt, Israel, Cyprus, and more recently Greece, have at varying degrees developed their national...