The worsening stand-off in the eastern Mediterranean, frequently described as a gas conflict, has been gaining momentum. It may seem a strange time to be fighting over gas when prices remain in a slump due to weak demand and investors withdrawing. So what explains the escalating conflict between Turkey, Greece, Cyprus and Egypt, which is drawing in other regional and European powers?
Large reserves of oil and gas were discovered in the region a decade ago. The estimates are worth trillions of dollars to the surrounding countries even at today’s prices.
On August 13 Turkish president Recep Tayyip Erdoğan warned there would be a heavy price for anyone attacking the Turkish drilling vessel Oruç Reis, which is exploring for oil and gas in waters claimed by both Turkey and Greece. This came after a collision between Greek and Turkish navy frigates left international actors on high alert.
France immediately pledged military support to Greece, while Angela Merkel reportedly called the Greek and Turkish leaders to help de-escalate tensions. The old Aegean rivals are now almost as close to open conflict as during Turkey’s 1974 Cyprus invasion.
The eastern Mediterranean
Until recently, the Turkish-Greek conflict over oil and gas was very much associated with the Cyprus problem: Turkey was drilling off the coast of Turkish-occupied northern Cyprus, a state not recognised by the rest of the international community. But the current stand-off has dramatically shifted the conflict into open sea.
Turkey claims exploitation rights within an area it claims as continental shelf. Greece’s counter claim is that all its inhabited islands are surrounded by a 200-mile exclusive economic zone (EEZ), per the UN Convention on the Law of the Sea, to which Turkey is not a party. A blind application of these rules “locks” Turkey’s exploitation rights into a small corner around the Gulf of Antalya.
Both claims are formalised in bilateral agreements with other countries in the region. Turkey signed an EEZ agreement in late 2019 with the Libyan Government of National Accord (GNA) in Tripoli and, more recently, Greece with Egypt.
The Turkish-Libyan agreement implies that not even the largest Greek island, Crete, has a continental shelf – let alone the much smaller Kastelorizo off the Turkish (Lycian) coast. This position is legally tricky, but Turkey’s claim for some share of the offshore cake seemed in particular to be understood by Germany. EU leaders haven’t been able to agree to impose new sanctions on Turkey to add to the ones they previously imposed in response to the drilling off Cyprus – at least for the time being. Erdoğan has allegedly promised Merkel that Turkey will soften its position in the days ahead.
With gas prices so low, it calls into question whether it would be profitable to extract these resources right now – let alone the plan between Israel, Greece and Cyprus to build an EastMed pipeline to sell the gas to the EU (which excludes Turkey and any notion of Turkish-occupied northern Cyprus).
Gas price, US$/therm
Yet the collapse of gas prices is outweighed by the implosion of the Turkish lira. Turkey is hungry for hydrocarbon-based growth and urgently needs more foreign exchange to prop up its currency, having lately been relying on dollars from Qatar. In this context, seeking energy wealth seems intuitive.
Except that it is not. Gas exploration and production, especially on a seabed, requires hefty upfront investment – never mind the geopolitical cost. Unsurprisingly, Israel now prefers solar energy to gas-fired power stations, while (legal) drilling has stopped off Cyprus altogether.
Undeterred, Turkey claims its position is more defensive than expansionist, but some commentators point to its “mavi vatan” (“blue homeland”) strategy in the eastern Mediterranean. At best, this is about naval hegemony. At worst, it implies revising borders agreed in the 1923 Lausanne treaty.
Turkey’s continuing commitment to Turkish-occupied northern Cyprus, alongside introducing the lira to the parts of northern Syria it controls, are seen as clear evidence. Yet with Turkey frozen out by the EastMed pipeline and most EEZ agreements in the region, Erdoğan’s assertiveness may be less about seizing territory or energy than pushing for a seat at the negotiating table.
Nonetheless, Turkish assertiveness has naturally galvanised potential adversaries – including Greece, Cyprus, Egypt, France and also Iraq, where Turkish forces are conducting a large operation against the Kurdish-separatist PKK. Meanwhile, the United Arab Emirates (UAE) that has come out as spearhead of this alliance.
The Gulf monarchies and Egypt are threatened by Turkey and Qatar’s pro-Muslim Brotherhood position, plus their military cooperation agreements – most recently including a naval facility in the Libyan rebel stronghold of Misrata. The UAE is intervening in Libya too, openly claiming responsibility for a recent airbase attack in western Libya where Turkish drones operate in support of the GNA. Together with the Turkey-Libya EEZ agreement, it shows how tightly the gas conflict is linked to Libya’s civil war.
The UAE’s peace deal with Israel can be seen in light of this Turkish expansionism – about which Israel has been conspicuously quiet. But if Israel is tacitly supporting the alliance, more assertive is another Mediterranean power, headed by a president who declared NATO “brain dead” in 2019 partly in reference to Turkey’s invasion of northern Syria.
Emmanuel Macron’s visit to Beirut was by no means as accidental as the explosion that devastated the Lebanese capital. He and the UAE pledged to co-fund harbour repairs, pre-empting Turkey’s own bid. France now has military agreements with the UAE, Greece, Cyprus and Egypt, all geared towards curbing the actions of a fellow NATO member and EU candidate.
And while Berlin is left trying to reach a balance in the Greece-Turkey confrontation, Washington, traditionally the guarantor of peace between the Aegean NATO rivals, has been almost totally silent. There is a sense that all parties want to take advantage of this, onshore and offshore, before the US elections. It is oddly this vacuum, rather than fossil fuels, that is fanning regional rivalries. With the US withdrawn, Moscow continuing its opaque brinkmanship and the EU split over Turkey, the scene is unfortunately set for more instability to come.