As Egypt signs a massive gas deal with Israel, this agreement reveals far more
than an energy need: it marks a strategic shift in regional power dynamics…
and challenges Africa.
It’s much, much, much, much better, like dramatically better, than any LNG alternative, and it will save billions of dollars to the Egyptian economy.
Yossi Abu, NewMed CEO
On August 7, 2025, Israeli company NewMed Energy confirmed the signing of a historic agreement with its Leviathan partners to supply natural gas to Egypt, via Dolphinus Holdings. Estimated value: $35 billion over 18 years, making it one of the most significant gas contracts of the decade in the Eastern Mediterranean.
Beyond the spectacular figures, this transaction reveals the new geopolitical and economic realities that are redefining African energy strategies. For Egypt, this is not just about energy. It’s a high-stakes geopolitical, economic, and diplomatic gamble.
Strategic Choice… or Forced Hand?
Egypt is one of the few African countries that produces liquefied natural gas (LNG). But in recent months, domestic production has plummeted, affecting exports and causing massive power outages across the country. Abdel Fattah al-Sisi’s government had no choice: securing supply had become vital.
This emergency situation unfolds against a particularly difficult economic backdrop. Egypt is currently experiencing one of the most severe crises in its modern history. Galloping inflation, drastic devaluation of the Egyptian pound, and recurrent energy shortages have pushed the government to reconsider its strategic
options.
Israeli gas offers several immediate advantages: geographical proximity guaranteeing reduced transport costs, technical quality suited to Egyptian industrial needs, and immediate availability. But this economic pragmatism conceals more complex issues. By committing for nearly two decades, Egypt ties its energy future to a partner whose relations with the Arab and African worlds remain tense.
Gas Diplomacy Redrawing the Balance
This agreement illustrates the growing role of gas as a diplomatic tool in the Middle East. It seals a strategic interdependence between two former adversaries and strengthens the Israel-Egypt axis in a regional context marked by persistent tensions, notably in Gaza.
The agreement comes at a particularly tense security moment. In June 2025, exports from the Leviathan field were interrupted for twelve days during a conflict between Israel and Iran, highlighting the vulnerability of energy supplies to regional geopolitical uncertainties.
For Egypt, this situation creates a revealing paradox. The country, which traditionally positions itself as a leader of the Arab world, is strengthening its economic ties with Israel at the very moment when regional tensions are reaching critical levels. This apparent contradiction reveals a profound evolution in Egyptian
diplomacy: Cairo now favors a pragmatic approach, where immediate economic interests take precedence over traditional ideological considerations.
Israel, which has become a net gas exporter since the Leviathan field came into operation, is consolidating its regional energy power. For Egypt, this long-term commitment is a form of recognition of this influence, but also an assumed dependence.
An Africa Absent from the Great Energy Game?
This deal raises questions beyond the Middle East. It poses a broader question for the African continent: where does Africa stand in the global reconfiguration of energy flows?
Egypt, an African country, chooses to massively import gas from a non-African neighbor. This paradox shows how intra-African energy integration remains weak, despite rhetoric and regional initiatives like the African Continental Free Trade Area (AfCFTA).
The Egyptian-Israeli agreement illustrates a fundamental shift in Mediterranean energy geography, but also reveals the limits of South-South cooperation. Israel, historically dependent on energy imports, has become a major exporter in less than ten years thanks to the offshore discoveries of Tamar (2009) and Leviathan (2010).
This transformation upsets traditional balances and shows that even established energy powers can quickly shift from exporter to importer status. More broadly, this agreement highlights a troubling reality: Africa is rich in resources, but struggles to transform them into strategic leverage. The continent has considerable reserves, but their exploitation remains insufficient in the face of growing domestic demand and development needs.
A High-Risk Gamble
Committing $35 billion over 18 years, in such a volatile sector, is no small matter.
The Egyptian strategy carries several significant risks.
First, the geopolitical risk: dependence on a single supplier exposes the country to the consequences of any conflict involving Israel. The June 2025 interruption provides a foretaste. Then, the economic risk: the contract, denominated in dollars, exposes Egypt to monetary fluctuations in a context where the Egyptian pound remains under pressure. The $35 billion represents a considerable financial burden for a country already heavily indebted.
Finally, the diplomatic risk: by aligning more closely with Israel, Cairo exposes itself to internal criticism and regional tensions with its Arab and African partners. This situation risks diplomatically isolating Egypt, particularly in the current context of Middle Eastern tensions.
The gamble rests on several uncertainties: that domestic demand continues to grow, that infrastructure remains operational, that gas prices remain competitive, and above all, that the regional geopolitical context stabilizes.
Implications for Africa’s Future
The success of the Egyptian gamble will largely depend on the evolution of the regional context. If geopolitical tensions persist, Egypt will have to develop mechanisms to secure its supplies, notably through diversification of its import sources.
In the longer term, the agreement could serve as a catalyst for broader energy cooperation in the Eastern Mediterranean, potentially transforming Egypt into a true energy hub redistributing Israeli imports to other African and European markets.
The Egyptian example illustrates new energy partnership logics, where traditional geopolitical considerations give way to economic imperatives. This evolution could inspire other African countries in their own strategic choices, but also underlines the urgency of developing genuine continental energy sovereignty.
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Key Takeaways
The anatomy of this energy gamble reveals the new realities of the 21st century: in a world where geopolitical balances are rapidly recomposing, energy security becomes a matter of political and economic survival.
Energy: The agreement reveals Egypt’s growing energy vulnerabilities and the rapid transformation of Mediterranean gas flows, with lasting implications for African energy security.
Geopolitics: It consecrates a strategic rapprochement between Israel and one of Africa’s heavyweights, redefining regional alliances beyond traditional divides.
Power Dynamics: It shows how energy becomes an instrument of geopolitical influence, which some already master, and which Africa must learn to wield to avoid being subjected to global recompositions.
Time will tell whether this $35 billion gamble was visionary or reckless. One thing is certain: it challenges Africa on its ability to transform its resources into strategic influence.
