From Ethnic Cleansing to Energy Goals

The Hamas-Israel War is what we see in the international media. Ethnic cleansing is what happens behind the headlines.

The Hamas-Israel War is what we see in the international media. Ethnic cleansing is what happens behind the headlines. And the struggle to control the energy reserves in the Occupied Territories is its new stage.

In late October, UN Secretary-General António Guterres said that “nothing can justify the deliberate killing, injuring and kidnapping of civilians,” adding that “Hamas did not happen in a vacuum.”[i] It was an effort at balance, one that was soon misrepresented by partisan fanatics.

What follows is the story of this “vacuum.” An outline of the ultimate causes; that is, extremist settler terror and missed opportunities of peace, longstanding ethnic cleansing and the effort to control huge offshore oil and gas reserves.

The failed Gaza uprising scenario

In the late 1990s, the Palestinian Authority (PA) contracted British Gas (BG) to develop the confirmed oil and gas fields offshore Gaza. With its natural gas industry, Egypt would serve as the on-shore hub and transit point for the gas. BG pledged to finance the development and operating of the resulting facilities in exchange for 90% of the revenues, whereas PA would receive just 10%, plus access to adequate gas to meet their needs.[ii] But Israel, too, wanted a cut.

In 1999, Prime Minister Ehud Barak deployed the Israeli navy in Gaza’s coastal waters to impede the PA-BG deal. Israel demanded the gas to be piped to its facilities at a below-market-level price and control of all the revenues destined for the Palestinians, presumably to prevent the monies from being used to “fund terror.”[iii]

After 2006, when Hamas triumphed in Gaza’s democratic election, it triggered the surreal intervention by British PM Tony Blair who proposed the old deal structure, with the exception that the gas would be delivered to Israel, not Egypt, and the funds would first be delivered to the Federal Reserve Bank in New York for future distribution, again presumably to preempt financing of terrorist attacks.[iv]

The two pretexts killed the limited Palestinian budget autonomy, along with the Oslo Accords, as a path was paved for future wars, which would then be blamed on Palestinians as well. And when the Hamas-led Palestinian unity government refused the impossible offer, Israeli PM Ehud Olmert imposed a blockade on Gaza. The “‘economic warfare” was expected to result in a “political crisis” and uprising against Hamas. Israel put the Palestinians “on a diet, but not to make them die of hunger.”[v]

Hence, the launch of Israel’s 2006 Operation Cast Lead to subject Gaza to a “Shoah” (Hebrew for Holocaust), as Deputy Defense Minister Matan Vilnai warned. The idea was to “send Gaza decades into the past,” said commanding general Yoav Galant, Netanyahu’s current defense minister who now pledges to “wipe this thing called Hamas off the face of the earth.”[vi]

$644 billion energy reserves

The Operation did cause devastation in Gaza but failed to transfer the control of the gas fields to Israel. And as the West was swept by the Greater Recession in 2008-9, the new Netanyahu government found itself struggling with an energy crisis that became severe with the Arab Spring as Israel lost 40% of its gas supplies.

With energy prices soaring, Israel witnessed the largest mass protests in decades.

Ironically, Netanyahu’s government was saved by a discovery of a huge field of recoverable natural gas in the Levantine Basin, a largely offshore formation under the eastern Mediterranean. Israel claimed “most” of the newly confirmed gas reserves lay within Israeli territory, which sparked the contrary claims by and increasing tensions with Lebanon, Syria, Cyprus, and the Palestinians. Based on the 2010 US Geological survey, the oil and gas in the Levant Basin amounted to 122 trillion cubic feet of natural gas and 1.7 billion barrels of recoverable oil (Figure 1).[vii]

Figure 1  Oil and natural gas wealth in the Levant Basin

 In 2019, the UNCTAD reported that the Occupied Territories lie above sizeable reservoirs of oil and natural gas wealth, in Area C of the occupied West Bank and the Mediterranean coast off the Gaza Strip. Yet, occupation continues to prevent Palestinians from developing their energy fields so as to exploit and benefit from such assets. Source: UNCTAD

What are the economic stakes in this resource struggle? In 2023 US dollars, the value of these resources translated to $557 billion and $87 billion, respectively. That’s about $644 billion in total.[viii]

But there was more at stake.

The $16-$55 billion Ben Gurion Canal

Located in Egypt, the Suez Canal connects the Red Sea and the Gulf of Suez with the Mediterranean Sea. Some 12% of the world’s trade passes through Suez on 18,000 ships a year. In March 2021, it was blocked for six days by a container ship that had run aground. What if there was an alternative pipeline?

In the mid-19th century, the British considered the proposal of a canal to the Red Sea via the Dead Sea. In the early 1960s, a secret and controversial US proposal involved 520 nuclear blasts to excavate through Israel’s Negev desert. The idea was kept secret through the Cold War until October 20, 2020, when the Israeli state-owned Europe Asia Pipeline Company (EAPC) and the UAE-based MED-RED Land Bridge inked a deal to use the Eilat-Ashkelon pipeline to move oil from the Red Sea to the Mediterranean. Interestingly, this occurred just 1 month after the Abraham Accords on Arab-Israeli normalization between Israel, the UAE and Bahrain.

In April 2021, Israel announced that work on the Ben Gurion Canal would begin by summer. The construction was expected to take about 5 years and employ 300,000 engineers and technicians. With estimated costs at $16 to $55 billion, the canal was expected to generate over $6 billion in annual income (Figure 2).[ix]

Figure 2 The Ben Gurion Canal project

 One of the original planned routes, designed to avoid the Gaza Strip (the trajectory in red color)         Map: The New Arab, created with Datawrapper

Netanyahu’s secretive plans

Following the global pandemic, the UAE, the host of COP28 conference in Dubai, distanced itself from the controversial plan Israeli environmentalists so vehemently opposed. The secretive EAPC had a dark environmental record. In 2011, it was responsible for Israel’s worst nature-reserve disaster; in 2014, for its worst environmental disaster.[x]

Oddly, in January, the Netanyahu cabinet extended secrecy for EAPC, despite objections. As traffic at the EAPC’s terminal on the Gulf of Eilat surged in July, activists warned of an impending disaster.[xi]

By October 7, the only thing that stood between the Netanyahu government and the massive canal project was Gaza. Hence, the concerted effort to undermine Palestine Authority, which in the 1990s still controlled Gaza; an attempt that began with Netanyahu’s gamble – in parallel with efforts to take over the offshore energy reserves and the proposed canal-building.

The original 7,400-word analysis was published by The World Financial Review (December-January issue), see

[i] “‘Even War Has Rules’, Secretary-General Tells Security Council, Demanding All Parties in Middle East Uphold International Humanitarian Law, Unrestricted Aid for Gaza.” UN Press Release, Oct 24, 2023.

[ii] Schwartz, M. 2015. “The Great Game in the Holy Land.” TomDispatch, Feb 26.

[iii] Nafeez Mosaddeq Ahmed. 2012. “Israel’s War for Gaza’s Gas.” Le Monde Diplomatique, Nov 28.

[iv] Schwartz, op. cit.

[v] Urquhart, C. 2006. “Gaza on brink of implosion as aid cut-off starts to bite.” The Guardian, Apr 16.

[vi] “Barak: Hamas Will Pay for Its Escalation in the South.” Haaretz, Feb 29, 2008; “Israel’s new war cabinet vows to wipe Hamas off the earth.” Reuters, Oct 12.

[vii] Schenk, C. J. e al. 2010. Assessment of Undiscovered Oil and Gas Resources of the Levant Basin Province, Eastern Mediterranean. US Geological Survey, March.

[viii] The Economic Costs of the Israeli Occupation for the Palestinian People: The Unrealized Oil and Natural Gas Potential. UNCTAD. 2019.

[ix]  “Israeli pipeline company signs deal to bring UAE oil to Europe.” Reuters, Oct 20, 2020.

[x] “Cabinet extends secrecy for state-owned oil infrastructure firms, despite objections.” Times of Israel, Jan 29, 2023.

[xi] “Number of Oil Tankers in Eilat Has Jumped Fivefold, and Risks Are Rising.” Haaretz, Jul 13, 2023.

Dr. Dan Steinbock
Dr. Dan Steinbock
Dr. Dan Steinbock is an internationally recognized strategist of the multipolar world and the founder of Difference Group. He has served at India, China and America Institute (US), Shanghai Institutes for International Studies (China) and the EU Center (Singapore). For more, see