Jordan, Israel, and energy security in the Eastern Mediterranean

Abstract

On January 1, 2020, the Hashemite Kingdom of Jordan received its first natural gas imports from neighboring Israel as part of a 15-year, $10 billion gas sales contract signed in 2016 between state power provider NEPCO and operator of the giant Leviathan offshore gas field, American firm Noble Energy. The deal is the largest instance of economic cooperation between an Arab state and Israel (rivaled only by Egypt’s subsequent gas import deal), and in spite of Jordan and Israel’s 1994 peace treaty, has proven extremely controversial in Jordan – leading to dozens of protests, parliamentary condemnation, and pressure to renege on the contract. This thesis attempts explain why the Jordanian monarchy opted for such a controversial policy decision, particularly following years of anti-liberalization protests and the Arab Spring. The key finding is that for Jordan’s rulers, maintaining energy security is more than a technocratic calculation; indeed, it is a matter of regime survival. And at the same time, the deal is not a total departure from the past: key historical path dependent developments are critical to understanding the outcome – specifically relating to Israel-Jordan relations dating back to the British mandate as well as Jordan’s energy sector. Starting with the concept of energy security – broadly defined here as “the uninterrupted availability of energy sources at an affordable price” – this thesis examines the history of Jordan’s energy sector, its links to the kingdom’s financial outlay, and crucially, the particular role that energy provision has played in its rentier economic model. Taking all these factors together, it becomes clear that despite the negative optics of the Israel-Jordan deal and the subsequent protests it inspired, discounted and consistent imports from Israel were too good for the monarchy to pass up. Additionally, this thesis also demonstrates some of the unintended consequences that emerged out of International Mo