Finance Minister Bezalel Smotrich has requested Prime Minister Binyamin Netanyahu to delay the decision on large-scale gas exports in order to allow for a comprehensive staff work process. In a letter sent to the Prime Minister, Smotrich emphasized the strategic and geopolitical implications of the decision, stating that it requires a comprehensive view. The request comes after the head of the budget department, Yogev Gerdos, warned of a potential partial shortage of gas in Israel within 15 years due to increased exports.
The Ministry of Energy has been promoting the export permits, with plans to approve them as early as August 8. However, in response to a report by Moody’s rating agency, Minister of Finance Smotrich highlighted the resilience of Israel’s economy and the increase in gas exports to Europe. It is important to note that the decision to increase exports has not yet been made.
The ministry has not published any long-term analysis regarding the ability of local gas reserves to meet growing demand over time. The current arrangement allows for the full export of all newly discovered gas reserves, without retaining any for the local economy. Without additional exports, the economic viability of developing existing reservoirs to increase output will be compromised. Energy Minister Israel Katz has promised that exports will not come at the expense of gas consumption in Israel, but has not provided a clear plan for maintaining this principle beyond the next 15 years.
The accelerated export of gas could have negative consequences, including an increase in gas prices in the local market, reduced competition, and potential compromise of energy security in the future. The depletion of the “Shark” and “Tamar” reservoirs will eventually leave the Leviathan reservoir with a monopoly status.
It remains to be seen whether the Prime Minister will comply with the Finance Minister’s request to delay the decision on gas exports and convene a professional team for further assessment.