Delegated Authority and Israel’s Energy Play: The Strategic Fallout from South Pars and Ras Laffan

March 21, 2026
| No Comments
| Activities, Publications, Think Tank

1. The Military Crisis and a Shifting Energy Architecture

On March 19, 2026, at a press conference in Jerusalem — with the war against Iran visibly escalating — Israeli Prime Minister Benjamin Netanyahu sketched out a possible new oil and gas transit route: pipelines running across the Arabian Peninsula directly to Israel’s Mediterranean ports, bypassing the Strait of Hormuz entirely.1

The proposal would have sounded far-fetched at any other time. “Just run the oil and gas pipelines west across the Arabian Peninsula straight to Israel, straight to our Mediterranean ports,” Netanyahu said. “You’ll eliminate the bottlenecks forever.”2

He made those remarks in the immediate wake of Israel’s strike on South Pars — the world’s largest natural gas field, shared by Iran and Qatar3 — and Iran’s retaliatory attacks on Gulf energy infrastructure, hitting the Ras Laffan LNG complex in Qatar, the SAMREF refinery in Saudi Arabia, and facilities in the UAE and Kuwait.4 The strikes disabled roughly 17 percent of Qatar’s LNG export capacity for an estimated three to five years, with projected annual revenue losses of up to $20 billion, according to QatarEnergy CEO Saad al-Kaabi.5 Oil flows through Hormuz, which carried around 15 million barrels of crude per day before the war,6 were sharply curtailed as Iran effectively closed the strait to commercial shipping beginning March 4.7 Alternative transit routes, long a subject of medium-term planning, became an immediate regional priority.

2. The Oil Infrastructure: Eilat–Ashkelon and the East–West Pipeline

The core of what Netanyahu proposed is largely already built. The Trans-Israel Pipeline — operated by EAPC, running 254 kilometers with a 42-inch diameter between the Red Sea port of Eilat and the Mediterranean port of Ashkelon — can carry up to 60 million tons of oil per year, or roughly 1.2 million barrels per day, in the westbound direction.8 Constructed in 1968, it once moved Iranian crude before the revolution.9 In October 2020, following the Abraham Accords, EAPC signed a memorandum of understanding with UAE-based MED-RED Land Bridge to transport Emirati oil through Eilat toward European markets, confirming that the infrastructure was ready, commercially and technically, to handle Gulf supply.10

Saudi Arabia’s East–West Pipeline (Petroline) connects the Eastern Province oil fields to the Red Sea port of Yanbu at a capacity of up to seven million barrels per day.11 By March 2026, with Hormuz partially blocked, Saudi Arabia had been increasingly diverting oil to Yanbu via this line.12 Yanbu sits roughly 200 kilometers from the area that could plausibly be connected to Eilat. In engineering terms, Netanyahu’s proposal means completing a relatively short link between two systems that are already running.

The one fundamental obstacle is the absence of formal Saudi–Israeli normalization. But in wartime, and with a global energy crisis accelerating, security cooperation between Riyadh and Jerusalem need not be cast as a break with Islamic solidarity. It could just as easily be framed as an act of economic necessity — and one that serves the Gulf monarchies as much as anyone.

Read in that light, the pipeline proposal is a public signal to Riyadh: normalization now comes with a concrete return — an overland export route independent of straits and canals, something no other partner can offer.

3. Israel’s Gas Strategy and the Egypt Connection

Alongside the oil transit picture, Israel’s natural gas export position has been expanding steadily. The Leviathan and Tamar offshore fields together produce roughly 21 billion cubic meters per year, with expansion plans targeting higher output through additional drilling and infrastructure investment.13 In December 2025, Israel approved the largest gas export contract in its history: up to 130 billion cubic meters delivered to Egypt through 2040, valued at approximately $35 billion.14

Part of that volume will go directly into Egypt’s domestic economy, offsetting declining local production. A portion may be re-exported as LNG to Europe via Egypt’s Idku and Damietta liquefaction facilities.15 To support the contract, the Ashdod–Ashkelon line is being upgraded and a new export route through Nitzana is planned as part of the deal’s second phase.16 Egypt has become more than Israel’s largest gas customer — it is now a transit link in its own right. Israel, in turn, is establishing itself as a reliable supplier for the Egyptian market and a potential backstop for European energy security.

4. The South Pars Strike and the Limits of Delegation

South Pars/North Field underpins both Iran’s domestic gas supply and Qatar’s LNG export stream. Israel’s strike there had a dual purpose: to degrade the financial base of the Islamic Revolutionary Guard Corps, and to demonstrate that critical regional energy infrastructure was not invulnerable.17 Iran’s retaliatory strikes on Ras Laffan and other Gulf facilities then created urgent demand for alternative supply routes — which, almost by default, raised the strategic value of Israeli and Saudi infrastructure.

President Donald Trump’s public statement — that he had “not been informed” of the South Pars strike and was asking Israel to hold off on further attacks against Iranian gas infrastructure — exposed a real tension at the center of the delegation relationship.18 Netanyahu himself confirmed the dynamic at the March 19 press conference: “Fact number one, Israel acted alone against the Asaluyeh gas compound. Fact number two, President Trump asked us to hold off on future attacks, and we’re holding off.”19 The 2026 National Defense Strategy (NDS 2026), published by the Department of Defense on January 23, 2026, and signed by Secretary Pete Hegseth, designated Israel a “model ally” capable of acting independently.20 The document’s exact phrasing: “In the Middle East, Israel showed that it was able and willing to defend itself after the barbaric attacks of October 7th — in short, that it is a model ally.”21 But the NDS includes no mechanism for preventing Israeli initiatives that create unacceptable risks for Washington. The result is a familiar problem in any delegation arrangement: the actor given operational latitude will sometimes use it in ways the principal would not have chosen.

5. IMEC as the Framework for an Overland Route

The India–Middle East–Europe Economic Corridor (IMEC), announced at the G20 summit in New Delhi on September 9, 2023,22 formalizes the exact configuration Netanyahu has described as a “New Middle East.” IMEC’s eastern segment links the Indian subcontinent to Gulf ports; its northern overland segment runs through Jordan and Israel to the port of Haifa and onward into Europe. Israel is the only land bridge between the Arabian Peninsula and the eastern Mediterranean.

Indian Prime Minister Narendra Modi’s two-day visit to Israel on February 25–26, 2026 — the first by an Indian head of government to address the Knesset — reaffirmed New Delhi’s commitment to both IMEC and the I2U2 framework (India–Israel–UAE–United States).23 India and Israel also upgraded their bilateral ties to a Special Strategic Partnership during the visit.24 The partial closure of Hormuz and the attacks on Gulf infrastructure effectively fast-tracked IMEC from a planning concept to a live response instrument. The Gulf–Suez–Europe sea lane had been shown to be vulnerable. The overland route through Israel had not.

6. Consequences for the Shia and Sunni Coalitions

The fallout from these events cuts differently across the two broad regional coalitions Netanyahu has identified as opponents of an Israeli-centered regional order.

The Shia axis — Iran, Hezbollah, the Houthis, and Iranian-aligned forces in Iraq — has suffered cumulative damage across the board: military infrastructure has been struck at scale, elements of Iran’s nuclear program disabled, South Pars degraded, and the energy revenues that fund the entire enterprise seriously reduced. Iran’s ability to subsidize its partners has shrunk, and so has its capacity to use the threat of energy disruption as leverage. South Pars alone represents approximately 80 percent of Iran’s domestic natural gas supply.25

The Sunni configuration is more varied. Saudi Arabia and the UAE, staying formally out of the conflict, are nonetheless structural winners in the emerging order: they gain a Hormuz-independent export route, deepen their roles in IMEC and I2U2, and have a clearer path into an Israeli-centered transit network.

Qatar is the clearest loser. The Ras Laffan damage strips Doha of a large share of gas revenues for years, and its reliance on American security guarantees and financial support is forcing a foreign-policy recalibration. QatarEnergy declared force majeure on its entire LNG output following the attacks, and al-Kaabi said the scale of the damage has “set the region back 10 to 20 years.”26

Turkey finds itself structurally sidelined. Reduced Iranian gas supplies, rising domestic energy costs, a diminished role as a go-between among Washington, Jerusalem, and Tehran, exclusion from IMEC, and a strengthened Kurdish factor have all worsened Ankara’s external position and its economic outlook at once. Taken together, these pressures are accelerating the unraveling of the pan-Turkic Sunni bloc — the model in which Turkey aspired to serve as the military-political hub, Qatar as the financial backer, the Muslim Brotherhood and Hamas as the operational arm, and post-Assad Syria as the forward strategic position.

7. The Qatar–Turkey Relationship and the Muslim Brotherhood Network Under Pressure

Qatar and Turkey are tied together by durable financial and political arrangements. After the Saudi-led blockade of 2017, Ankara extended Doha a military and economic umbrella; in return, Qatar opened currency swap lines and expanded Qatar Investment Authority investment in Turkey — providing an external lifeline for the Turkish economy during successive lira crises.27 This relationship supplied the material foundation for the transnational network associated with the Muslim Brotherhood: Qatar provided the money, Turkey the political and territorial cover, and Hamas along with affiliated movements the on-the-ground execution.

The damage to Ras Laffan and the loss of 17 percent of LNG export capacity — with revenue losses potentially reaching $20 billion annually28 — limits Qatar’s ability to maintain its previous level of external political spending. At the same time, U.S. and Gulf pressure on both Doha and Ankara to distance themselves from Muslim Brotherhood-linked organizations is intensifying. The network is losing both its primary funding source and its geographic base. As Qatar’s resources shrink and Turkey’s room for maneuver narrows, the pan-Turkic Sunni bloc continues to contract.

8. Netanyahu’s Proposal as a Bid to Shape the Post-War Order

Netanyahu’s pipeline proposal is less a technical blueprint than a bid to define who benefits from the crisis — and on what terms. It translates a military outcome — the South Pars strike, the partial closure of Hormuz, the spike in energy prices — into the language of infrastructure and contracts. The implicit argument is that Israel should capture a lasting structural role from the disruption it helped create.

For Saudi Arabia, the statement works as a public offer: normalization is now tied not to vague security assurances but to a specific asset — an overland, straits-independent export corridor unavailable through any other partner. For the United States, it points toward a possible return on the costs of the conflict: a more resilient supply configuration that would reduce future American exposure to Iranian pressure on Hormuz. For the EU and other importers, it signals that the proposed backstop to maritime routes is the Gulf–Israel–Mediterranean corridor specifically — not some alternative that routes around Israeli territory.

Even if no pipeline gets built anytime soon, framing the proposal publicly changes the terms of future negotiations. It positions Israel as the natural claimant to the role of central transit hub, strengthening its leverage with Gulf states. In that sense, Netanyahu’s statement is not a description of an order already in place. It is an attempt to lock in Israeli infrastructure as the default starting point for whatever regional energy reconstruction comes next.

Igor Kaminnyk ORCID iD 0009-0008-0981-965X

Footnotes

  1. Netanyahu press conference, Jerusalem, March 19, 2026. Times of Israel transcript: https://www.timesofisrael.com/netanyahu-transcript-we-have-to-be-more-powerful-than-the-barbarians-or-they-will-crash-our-gates-destroy-our-societies/
  2. Ibid. Direct quote from the press conference transcript.
  3. CNN explainer on South Pars: https://www.cnn.com/2026/03/19/middleeast/iran-qatar-south-pars-gas-field-explainer-intl
  4. Ibid.; CBS News live updates: https://www.cbsnews.com/live-updates/iran-war-israel-strike-south-pars-gas-field-trump-threat-oil-gas-prices/; Bloomberg: https://www.bloomberg.com/news/articles/2026-03-18/iran-says-strikes-hit-key-south-pars-gas-field-oil-facilities
  5. QatarEnergy official statement via Fox Business: https://www.foxbusiness.com/economy/iranian-strikes-cut-17-qatar-lng-output-threatening-global-supply; QatarEnergy on X: https://x.com/qatarenergy/status/2034726978637471993; Al Jazeera: https://www.aljazeera.com/news/2026/3/19/iran-attacks-cut-17-of-qatars-lng-capacity-for-up-to-5-years-qatarenergy
  6. Wikipedia, “Strait of Hormuz”: https://en.wikipedia.org/wiki/Strait_of_Hormuz (“By 2025, around 15 million barrels of oil per day were transported through the strait”); EIA data (2024 average: 20 million bpd including products): https://www.eia.gov/todayinenergy/detail.php?id=65504
  7. Wikipedia, “2026 Strait of Hormuz crisis”: https://en.wikipedia.org/wiki/2026_Strait_of_Hormuz_crisis; Congressional Research Service report: https://www.congress.gov/crs-product/R45281; Al Jazeera on emergency reserves: https://www.aljazeera.com/economy/2026/3/15/strategic-oil-release-may-calm-markets-but-cannot-fix-hormuz-disruption
  8. EAPC official website: https://engarchive.eapc.co.il/the-crude-oil-system/pipelines/; Wikipedia, Trans-Israel pipeline: https://en.wikipedia.org/wiki/Trans-Israel_pipeline; Global Energy Monitor: https://www.gem.wiki/Trans-Israel_Oil_Pipeline
  9. Wikipedia, “Eilat Ashkelon Pipeline Company”: https://en.wikipedia.org/wiki/Eilat_Ashkelon_Pipeline_Company
  10. S&P Global Commodity Insights, October 20, 2020: https://www.spglobal.com/commodity-insights/en/news-research/latest-news/crude-oil/102020-israeli-pipeline-company-to-transport-uae-oil-via-red-sea-med-network; Mongabay: https://news.mongabay.com/2021/07/israel-u-a-e-pipeline-deal-invitation-to-disaster-for-globally-important-corals/
  11. Wikipedia, “2026 Strait of Hormuz crisis,” citing Saudi Petroline capacity data.
  12. Wikipedia, “2026 Strait of Hormuz crisis”: “As of 10 March, Saudi Arabia increasingly diverted oil to the Red Sea port of Yanbu via the East–West Crude Oil Pipeline”; Iran International: https://www.iranintl.com/en/202603152504
  13. S&P Global on the Israel-Egypt deal, citing Israeli Ministry of Energy data: Leviathan produced 11.3 Bcm in 2024; Tamar produced 10.1 Bcm: https://www.spglobal.com/energy/en/news-research/latest-news/natural-gas/121825-israel-approves-35-bil-egypt-gas-export-deal
  14. S&P Global: https://www.spglobal.com/energy/en/news-research/latest-news/natural-gas/121825-israel-approves-35-bil-egypt-gas-export-deal; CNN: https://www.cnn.com/2025/12/17/middleeast/israel-gas-deal-egypt-latam-intl; NewMed Energy statement via Al Jazeera: https://www.aljazeera.com/news/2025/12/18/egypt-says-gas-deal-with-israel-is-purely-commercial
  15. Egypt Independent: https://www.egyptindependent.com/all-you-need-to-know-about-egypt-and-israel-record-breaking-35-billion-gas-deal/; Steptoe analysis: https://www.steptoe.com/en/news-publications/stepwise-risk-outlook/israel-and-egypt-advance-a-dollar35-billion-gas-deal-but-political-obstacles-remain.html
  16. World Oil / NewMed Energy statement: https://worldoil.com/news/2025/8/8/israel-egypt-reach-35-billion-deal-for-natural-gas-supply/
  17. Axios: https://www.axios.com/2026/03/18/israel-strikes-iran-natural-gas-infrastructure; CNN: https://www.cnn.com/2026/03/19/middleeast/iran-qatar-south-pars-gas-field-explainer-intl
  18. Trump Truth Social post cited in Al Jazeera: https://www.aljazeera.com/economy/2026/3/19/why-are-irans-south-pars-gasfield-qatars-ras-laffan-so-significant; Bloomberg: https://www.bloomberg.com/news/articles/2026-03-19/israel-will-avoid-attacking-iran-s-energy-assets-netanyahu-says
  19. Times of Israel liveblog, March 19, 2026: https://www.timesofisrael.com/liveblog-march-19-2026/
  20. Breaking Defense, January 23, 2026: https://breakingdefense.com/2026/01/national-defense-strategy-hegseth-pentagon-western-hemisphere/; USNI News: https://news.usni.org/2026/01/24/2026-u-s-national-defense-strategy; full PDF: https://media.defense.gov/2026/Jan/23/2003864773/-1/-1/0/2026-NATIONAL-DEFENSE-STRATEGY.PDF
  21. NDS 2026, direct quote, as cited in Small Wars Journal: https://smallwarsjournal.com/2026/01/24/2026-national-defense-strategy/; Jerusalem Post: https://www.jpost.com/international/article-884380
  22. Al Jazeera on IMEC: https://www.aljazeera.com/news/2026/2/26/india-israel-axis-what-are-the-imec-corridor-i2u2-grouping-modi-spoke-of (“The IMEC project was announced on September 9, 2023, during a Group of 20 summit in New Delhi.”)
  23. Al Jazeera on Modi’s visit: https://www.aljazeera.com/features/2026/2/26/from-gaza-to-defence-five-key-takeaways-from-indian-pm-modis-israel-visit; ANI / The Tribune on IMEC discussions: https://www.tribuneindia.com/news/benjamin-netanyahu/extremely-important-foreign-secy-misri-says-imec-discussed-at-some-length-during-pm-modis-israel-visit
  24. International News and Views on the Special Strategic Partnership upgrade: https://internationalnewsandviews.com/modi-netanyahu-israel-visit-special-strategic-partnership-imec-i2u2-deals-398341-2/
  25. Al Jazeera: https://www.aljazeera.com/news/2026/3/19/iran-warns-it-will-show-zero-restraint-if-infrastructure-attacked-again (“South Pars is Iran’s biggest source of domestic gas supply, providing 80 percent of the country’s natural gas needs.”)
  26. Al Jazeera citing al-Kaabi: https://www.aljazeera.com/news/2026/3/19/iran-attacks-cut-17-of-qatars-lng-capacity-for-up-to-5-years-qatarenergy
  27. On Qatar-Turkey financial ties and swap lines, see general reporting on the 2017 Qatar blockade and its aftermath; QIA investments in Turkey are well-documented in financial press.
  28. QatarEnergy official statement, March 20, 2026: https://www.foxbusiness.com/economy/iranian-strikes-cut-17-qatar-lng-output-threatening-global-supply ↩
| Tags: , , , , , ,