Egypt has emphasized that its natural gas agreement with Israel is a purely commercial transaction, dismissing any claims of political motivations behind the $35 billion deal. The announcement comes amid frayed relations between Cairo and Jerusalem over Israel’s ongoing conflict in Gaza.

Commercial Nature of the Deal

Egypt’s State Information Service (SIS) clarified on Thursday that the gas deal was conducted exclusively by private energy companies operating under market rules, without direct government involvement.

“The deal is a purely commercial transaction concluded on the basis of strictly economic and investment considerations, and entails no political dimensions or understandings of any kind,” said SIS chief Diaa Rashwan.
“The agreement serves a clear strategic interest for Egypt, namely strengthening its position as the sole regional hub for gas trading in the Eastern Mediterranean.”

Israel’s Approval of the Gas Agreement

Israeli Prime Minister Benjamin Netanyahu announced the deal on Wednesday evening, calling it “the largest gas deal in Israel’s history.” The agreement, worth 112 billion shekels ($34.7 billion), will allocate approximately 58 billion shekels ($18 billion) to Israeli state coffers.

“The agreement is with the American company Chevron, alongside Israeli partners who will supply gas to Egypt,” Netanyahu said during a televised address, highlighting the strategic and economic significance of the deal.

The export agreement, originally signed in August 2025, involves supplying gas from Israel’s Leviathan natural gas field to Egypt over several years.

Historical Context and Political Tensions

The gas deal has unfolded against a backdrop of strained Israel-Egypt relations. In September, Netanyahu reportedly instructed that the agreement should not proceed without his approval, citing alleged violations of the 1979 Egypt-Israel peace treaty, specifically military deployments in Sinai—a claim Cairo has denied.

The Camp David Accords of 1978 and the 1979 peace treaty established normalized diplomatic relations, full Israeli withdrawal from Sinai, and the demilitarization of the peninsula. Despite this long-standing framework, tensions have escalated recently due to Israel’s military actions in Gaza.

Egypt has been a vocal critic of Israel’s operations in Gaza and has played a pivotal role in mediating ceasefires. However, the humanitarian crisis in Gaza continues, and the fragile truce remains at risk.

Strategic and Regional Implications

While Egypt insists the gas agreement is commercial, the deal strengthens its position as a regional energy hub in the Eastern Mediterranean, giving Cairo a central role in regional gas trade and energy security. Analysts note that the partnership with Israel and Chevron also signals Egypt’s growing influence in global energy markets.

The agreement also comes amid pressure from the United States, with former President Donald Trump reportedly encouraging a meeting between Egyptian President Abdel Fattah el-Sisi and Netanyahu, who have not met publicly for years.

Conclusion

Egypt’s $35 billion gas deal with Israel underscores the complex intersection of commerce, energy strategy, and regional politics. Despite ongoing tensions over Gaza and historical mistrust, both nations are leveraging the agreement to advance economic and strategic objectives, while emphasizing its non-political nature.