Egypt's abrogation of the gas deal - a portent...

"Israel's prime minister on Monday scrambled to contain the damage from Egypt's decision to cut off natural gas exports, dismissing the matter as a mere "business dispute" as he tried to prevent a full-fledged diplomatic crisis.

The comments by Benjamin Netanyahu contrasted with earlier statements by Cabinet ministers who warned the Egyptian move threatened to harm already shaky relations between the two nations.

"We don't see this cutoff of the gas as something that is born out of political developments," Netanyahu said. "It's actually a business dispute between the Israeli company and the Egyptian company.""  ABC News

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The Beebster can talk himself blue in the face about this but, in fact, this is a major economic and diplomatic blow to Israel's future welfare.

The fact that this has occurred BEFORE the Islamist and basically anti-Israeli forces in Egypt are fully empowered is ominous.

IMO it is only a matter of time before the Egyptians withdraw from the treaty of peace with Israel.  pl

http://abcnews.go.com/Business/wireStory/egypt-terminates-gas-deal-israel-16190708

http://www.csmonitor.com/World/Backchannels/2012/0423/Egypt-s-cancellation-of-gas-sales-to-Israel-was-inevitable

Comments

[Jose]

"Birth pangs of a new Middle East" - Condi

[Matthew]

Col: Isn't a "partial withdrawal" from the Treaty long overdue? Many of security provisions, including demilitarizing the Sinai, should have been time-limited. After 10-15 years, the treaty no longer "builds trust" as much as it permits Zionist extra-territorial control over Egypt. This is occupation in all but name.

And the subsidized natural gas? Grotesque. How long is that subsidy to the "economic miracle" supposed to last? Last I heard, Egypt was dirt poor.

Israel failed to modify parts of this treaty when their servant, Omar Sulieman, was their interlocutor. They will now negotiate with people less flexible.

It will be interesting to see whose side Saudi Arabia will take if relations unravel.

[turcopolier]

Matthew

You have this completely wrong. 1- OS was never their "servant."It has long been a custom in Egyptian governments for officials of the GID to be involved in Egypt's foreign affairs. They are often "covered" as members of Egypt's foreign service for a lifetime. (Oh, I forgot many of you have no idea what "cover" means) in his capacity as head of GID, OS was employed by HM as the manager for the "files" on; Libya, Israel and several other foreign countries. Was he Libya's servant as well? 2- The gas deal has made many in Egypt and Israel wealthy. OS is not among them. 3- The great majority of Egyptians do not now and never did want the treaty of peace with Israel. It is not a matter of minor adjustments about Sinai or orher trivialities. The Jordanian people do not want their treaty either. --- Israel is going to go back to the status of the place "where airplanes go to sleep when they are tired." pl

[Andy]

I'm not sure I follow. If one withdrawals from a peace treaty, is that not tantamount to declaring war?

What could we expect to see if this happens - a tossing of ambassadors, withdrawal of recognition and a cold war between the two states? Something else?

[Farmer Don]

"Israel is going to go back to the status of the place "where airplanes go to sleep when they are tired." pl"
Lets see, should I wait till someone else wants to know what this means, or just show my ignorance and ask now?

[J]

Israel's own holier-than-though insolence is doing themselves in. Their bully attitude and behavior is not helping things either.

Israel's possession of deliverable nuke toys remains the problem for the neighborhood, and a headache to others (U.S. to name just a few moments of consternation with the ungrateful little pipsqueak postage stamp [bonehead Israel]).

Israel sadly wouldn't know civility if it hit them in their haughty backsides. By Israel's own hands are they the instrument of their own destruction.

Guess we get out the popcorn and soda-pops, pull up a good chair and watch their implosion.

[turcopolier]

J et al

someone give me the link to the Oren interview. pl

[turcopolier]

Farmer Don

Shimon Peres, when a member of the Knesset, said this to me and several others in his closet sized Knesset office. He was referring to the pre-Egypt Treaty situation in which there were no exits for commercial aircraft from Ben Gurion Airport other than back to Europe so the airplanes would sleep there for a while before going home. pl

[turcopolier]

Andy

No, not legally, but in fact it would mean a return to Israel's isolation. pl

[ert]

The Beebster can talk himself blue in the face about this but, in fact, this is a major economic and diplomatic blow to Israel's futuer welfare.

Col, you are underestimating Bibi. The joke is on us. They'll get their gas from another source and have the US tax payers pay the difference.

[oofda]

Colonel,
According to Haaretz, the Egyptians say they are willing to sell the Israelis the gas at a different price. The the reason the deal was cancelled was purportedly due to the failure of the Israelis to make payments required by the contract, they were at least 4 months in arrears.

The Haaretz link:
http://www.haaretz.com/news/diplomacy-defense/egypt-offers-to-sell-gas-to-israel-at-new-price-1.426094

[turcopolier]

oofda

Yeah, sure. Are you that gullible? pl

[turcopolier]

ert

Horse shit. There is always someone who wants to say that the Hebrew "menace" is twenty feet tall. pl

[Babak Makkinejad]

These deals often contain arbitration clauses etc. for re-opening price negogiations.

If worse-comes-to-worse, the supplier will reduce the gas flow or cut it due to "much needed maintenace".

They are never cancelled outright.

[turcopolier]

BM

If you think this was caused by prices rather than politics you have really missed the point. pl

[Walrus]

Beautiful expression! Having worked in the airline industry and the hangars at 3am!

[The beaver]

Col

Is it the one I mentioned about 60 minutes:
http://www.cbsnews.com/video/watch/?id=7406228n&tag=contentBody;storyMediaBox

[Walrus]

Agree 100% with Col. Lang. Unless the Egyptians declare "Force Majeur" its political, maybe even then.

[oofda]

Not sure to discount that this was a move to get more money One would think that Egypt Natural Gas Holding Company (EGAS) could substantiate not being paid.

This had long been a contentious issue due to the relatively low price Israel was paying- the contract was reportedly originally at $1.25 per British thermal unit (BTU), but later was raised to $4 per BTU. That price was low by comparison to prices paid by Turkey, Greece and Italy, of $7-$10 per BTU. Also Egyptian companies pay $4 per BTU. EGAS gets to make its own deals with Israeli buyers. There were complaints that Egypt was in effect subsidizing the Israelis but not Egyptians. The perception of subsidizing Israel at the expense of Egyptians was a galling issue for many. There had been lawsuits and investigations that Mubarak had deprived Egypt of a fair market price with Israel for the gas. That said, the cancelling the contract obviously does have serious political and economic implications for Israel.

[ThomasOfNY]

"IMO it is only a matter of time before the Egyptians withdraw from the treaty of peace with Israel."

Wouldn't such a bluntly anti-Israel policy prove to be very harmful to Egypt economically? In other words no or much less US aid to Egypt and a probable reduction of tourist dollars? Wouldn't this prove to be enough reason for the Egyptian government to avoid such a policy?

[turcopolier]

Thomasof NY

I guess you are new here. You think there are a lot of Israeli and Jewish tourists in Egypt? Hah. Any reduction in US aid to Israel will be made up by the Saudis. If you think the Saudis are Israel's "allies" you need to stop smoking the hasbara weed. If you think Egyptians like Israel (or Jews from anywhere) you have never spent much time there. pl

[Tony]

How about Israelis asking US to force Egyptians to reconsider their move!

[fanto]

it was on 60 Minutes - quite a surprise to see what CBS has done, refreshing

[mac n.]

Colonel,

I could not agree with you more.

Maybe the voices for a rational Israeli foreign policy will be empowered by the changing strategic landscape.

[johnf]

Any theories on who was causing the explosions on the gas line? I got the impression it was not the Egyptians but the Bedouin. The Egyptians have never liked the Bedouin and the Israelis have been ethnically cleansing them. I've read in the past that much of the smuggling into Gaza has been done by the Bedouin.

Are they starting to become an independent force like the Tuareg or the Somali fishermen/pirates, or have the Egyptians been paying them to bomb the line?