U.S. Policy and the Strategic Relationship of Greece, Cyprus, and Israel: Power Shifts in the Eastern Mediterranean

U.S. Policy and the Strategic Relationship of Greece, Cyprus, and Israel: Power Shifts in the Eastern Mediterranean

BY SETH CROPSEY, MARCH 2015

© 2015 Hudson IΙσραήλnstitute, Inc. All rights reserved.

TABLE OF CONTENTS

Executive Summary ………………………………………………………………………………………… 4

Introduction …………………………………………………………………………………………………….. 5

Israel-Turkey Relations ………………………………………………………………. 8

Turkish Foreign Policy ………………………………………………………………………………….. 11

Turkey and the “Arab Spring” …………………………………………………………………….. 13

Russia and Egypt …………………………………………………………………………………………… 15

Turkey and the Islamic State ………………………………………………………………………. 17

Eastern Mediterranean Energy Security …………………………………………………. 221

The Trans Adriatic Pipeline and the Gas Interconnector Greece-Bulgaria …………………………………………………………. 26

East-Mediterranean Pipeline ……………………………………………………………………… 29

Egypt: The Wild Card? ………………………………………………………………………………… 331

Energy Export Options: Egypt …………………………………………………………………….. 33

Turkish Violations in the Cypriot EEZ ………………………………………………………… 34

Turkey as a Transit State ……………………………………………………………………………… 35

Egypt as a Market and Exporter for Eastern Mediterranean Gas ………… 36

Regional Response: Military Cooperation in Greece, Cyprus and Israel …………………………………………………………………………… 39

What is to Be Done? …………………………………………………………………………………….. 44

Conclusion ……………………………………………………………………………………………………… 49 4

EXECUTIVE SUMMARY

An important focus of Hudson Institute’s research over the past year and a half has been security in the Eastern Mediterranean and energy security in particular. The reason for this concentration is recent natural gas discoveries off Cyprus and Israel. Subjects of special attention include both Cyprus and Israel’s roles in the Eastern Mediterranean energy corridor; the potential for the Eastern Mediterranean’s energy trade with the E.U.; and the political, energy, and security cooperation between Cyprus, Israel, and Greece against the backdrop of Turkey’s embrace of Islamist and jihadist movements in the Middle East as well as other related developments since large natural gas deposits were discovered. Hudson Institute’s research has included two trips to Greece and Cyprus, and one trip to Israel, for meetings with senior policymakers of the countries.

The recent gas discoveries in the Mediterranean offshore of Cyprus and Israel, and the future deep offshore drilling from leading oil majors, such as TOTAL, ENI, and Noble Energy, reflect the dynamism and future growth of the hydrocarbon industry in the Eastern Mediterranean. Commercial arrangements that reduce the companies’ risk profile are optimal, but with a host of variables, a favorable commercial outcome cannot be realized without political stability.

The strategic relationship that has formed between Greece, Israel, and Cyprus since 2010 is a model for successful regional cooperation. Closer security relations with the three countries will allow the U.S. to better address today’s global challenges including the fight against terrorism, energy security, and the stability of the global commons that is increasingly at risk as security in the Eastern Mediterranean becomes more problematic. U.S. policymakers will benefit from thinking ahead and being able to project and shape change – that’s what leadership is about. Their challenge is to imagine, articulate, and explain what U.S. policy will gain from supporting this new alliance in the Eastern Mediterranean.

The U.S.’s challenge is to be able to project force, assure energy security, and sustain the cohesiveness of the transatlantic alliance as the Western alliance faces new threats to its east and south. Hudson Institute believes that global security, prosperity and freedom require strong, engaged, and strategic American leadership at the heart of a vigorous network of allies. Stability on its southern inland sea flank requires the U.S. to reassume a leading role in the Mediterranean that it largely vacated at the end of the Cold War.

American allies and friends, Greece, Cyprus, and Israel, have established a strategic relationship that is a model for the new regional balance of power. The triangle provides the U.S. a democratic foundation for both the region and as NATO’s southeastern anchor.

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