The Odd and Not So Odd Timing Of Israeli-Turkish Reconciliation
December 18, 2015 § 2 Comments
This is starting to feel like Groundhog Day. In March 2013, I wrote an article for Foreign Affairs explaining the timing behind Israel and Turkey agreeing to reconcile, and here I am again nearly three years later explaining the timing behind Israel and Turkey agreeing to reconcile. That the two countries have had a number of false starts is instructive and provides the first lesson of the day, which is that despite yesterday’s announcement, expectations should be tempered until there is an actual signed agreement. That is not to say that this is a feint, but that there are still a lot of obstacles ahead, including President Erdoğan’s desire to use this as a domestic political win bumping against Prime Minister Netanyahu’s desire not to be used for Erdoğan’s political gain; a recent history of extremely difficult relations between the two governments that cannot be papered over at the drop of a hat; the Gaza blockade remaining as an extra large sticking point; and the big elephant – or more accurately, bear – in the room that is looming over this entire thing and that I’ll get to in a minute. In other words, this won’t be entirely easy so no champagne corks should be popping yet.
But assuming that this does indeed go through, it’s not terribly difficult to see why. What I wrote in March 2013 was that the two sides were being pushed together by energy needs and Syria, and that remains true today but even more acutely. Dan Arbell on Monday (exhibiting impeccable timing!) wrote about thawing relations between Turkey and Israel focusing on Turkey’s ongoing quest for energy security and Israel’s complementary ongoing quest to find an export destination for its natural gas, with the Syria situation being a factor as well. Turkey is in a serious bind now that its relationship with Russia has deteriorated in such a big way, and Israeli gas provides a way out. If Russia cancels the Turkish Stream project or even takes things one step further and halts natural gas shipments to Turkey entirely, Israeli gas won’t solve things in the short term but will provide a long term hedge against relying on Russia as a primary energy supplier. On the Israeli side, the simple truth is that no energy company is going to invest the resources to develop the Leviathan field without a viable export destination, and the two best large market options were always Egypt and Turkey. The first one is far less attractive now due to the recent Egyptian gas discoveries mitigating how much Israeli gas Egypt will want to buy over the long haul, leaving Turkey as the best destination remaining. There are still political hurdles to be overcome on both sides, and the technical hurdle of constructing a deepwater pipeline is nothing to sneeze at either, but the formal approval granted yesterday to Noble to develop Leviathan likely resulted directly from the reconciliation agreement with Turkey.
On Syria, Turkey is always desperate for more intelligence and coordination given how much it has been affected by the civil war, and Israel can benefit as well since it does not want spillover across its northern border. The Russian intervention has made this more stark for both sides, since where Israeli opinion has been divided from the start on whether it is better for Assad to stay or go, there has emerged a slightly dominant view that it is better for Assad to be deposed given his role as the linchpin of the Iran-Hizbollah axis, and Russian intervention now makes that harder (if you’re interested in the subject, I participated on a Wilson Center panel yesterday with Tamara Wittes and Yoram Peri on the subject of the Syrian crisis and Israeli security, and you can watch it here). For Turkey, which has set Assad’s downfall as its top foreign policy priority for over four years, Russia’s involvement in Syria is a disaster and so to the extent that Israeli priorities are slowly lining up on the same side, any joint cooperation is a net positive.
All of this is why the timing of rapprochement makes sense, maybe even urgently so on the Turkish side. So why do I think that in some ways it is odd? The same way that the Russia variable is driving Turkey to find alternative solutions to some of its problems and reestablish close links with its Western allies – and certainly making up with Israel is a factor in pulling the U.S. closer – the mirror image is true for Israel. Whereas in the past Israel could reconcile with Turkey and it would be cost-free in the larger geopolitical context, now it’s not quite so simple. Israel and Russia have gotten along remarkably well despite Israeli and Russian military planes both flying along the same corridor in southern Syria, and up until now Russia has respected and tolerated Israeli freedom of action to attack weapons convoys on their way to Hizballah in Lebanon. This shouldn’t be taken for granted, however, and a closer Israeli relationship with Turkey has the potential to alter this equation. Russia is undoubtedly annoyed by yesterday’s news as it has been trying to isolate Turkey as best it can, and that in itself may lead to frostier relations with Israel. But even if you take Russian pettiness out of the equation, closer coordination between the Israeli and Turkish militaries has real potential to encroach on Russian priorities in Syria, which mainly consist of ensuring Assad’s rule over at least part of the country. Should Israel be drawn into Turkey’s fight and end up striking Syrian army positions that do not directly impact Hizballah advanced weaponry, Israeli leeway in Syria will be quickly narrowed by Russia.
Furthermore, Israel has now dramatically reduced Russian leverage over Turkey by mitigating Russia’s energy blackmail strategy. This is not only a matter of economics but geopolitics as well, since Russia uses Gazprom and its energy policy as a tool for foreign policy outcomes, and in the case of Turkey, that has now been significantly undermined. I’m no Russia expert, and I don’t know that there is a Russia expert alive who can predict what Putin will or won’t do, but my casual observation of Russian behavior leads me to believe that it is not outlandish to assume that Putin won’t retaliate against Israel in some manner or another for throwing Turkey a gas lifeline. With relations with Russia as terrible as they are for Turkey, it makes sense for Ankara to risk even more Russian wrath if it means solving the energy security problem. What mystifies me a bit is why Israel, which has so far gotten along with Russia remarkably well despite working somewhat at cross purposes against Russia in Syria, would risk a downturn in relations with Russia in order to make up with Turkey, a country that cannot threaten Israel in any real way and upon whose favor Israel does not depend in order to keep on going after Hizballah in Syria. Helping Turkey out of its morass in order to realize some economic benefits while risking the chance of limiting your range of action in Syria and provoking a much stronger power is penny wise and pound foolish. On top of this, there is also the lesser but not irrelevant factor that Israel has been frantically trying to establish better ties with the “moderate” Sunni bloc that includes Saudi Arabia and Egypt, and there is no love lost for Turkey in that group of countries. When you look at the regional chess board, partnering in a closer way with Turkey brings with it some significant potential downside for Israel.
I’ll reiterate that nothing is done until it’s done, and so this post may prove to be as irrelevant as my last deep dive into this subject. From where I am sitting, this deal is a no-brainer for Turkey, but I don’t think the same can be definitively said for Israel. It will be fascinating to see where all of this leads and whether the benefits of reconciliation that both sides fantasize about end up fully materializing.
Turkey’s Iran Quandary
September 3, 2014 § 11 Comments
Taking a step back and looking at the Turkish-Iranian relationship, it strikes me that it is following a similar pattern to the one Turkey had with Syria until 2011. The Turkish relationship with Syria was based largely on economic ties, and Ankara played down any political factors that might cause tension in the name of trade and economic growth. When Bashar al-Assad’s murderous behavior became more pronounced as the Syrian civil war heated up, Tayyip Erdoğan and Ahmet Davutoğlu operated on a mistaken assumption that they could softly manage the problem and convince Assad to change his ways. They presumed that in the same way that they saw economic growth and trade as a factor outweighing everything else, Assad would view things the same way. Assad had far larger and more pressing concerns, however, and after promising to Davutoğlu’s face not to kill civilians, he promptly continued his massacring of Syrians, which led Erdoğan to blow a gasket after feeling personally betrayed and adopt a policy of getting rid of Assad at any cost. This in turn caused the rapid downward spiral of Turkish foreign policy, which has largely collapsed due to the government’s Syria policy – a policy that was neither well thought out or well planned, and one which the Turkish government concocted on the fly. It chose to ignore all sorts of warning signs and then turned on a dime, all to devastating effect.
The variables with Iran are different, but the basic dynamic is similar. Turkey has cultivated a friendly and cordial relationship with Iran despite a host of structural reasons to be wary of its erstwhile regional rival and in the face of a coordinated Western effort to keep Iran isolated until concerns over Iran’s nuclear program are resolved. Turkey has made a concerted effort to improve ties with Iran for economic reasons, and in fact the two countries activated a deal last month to reduce trade tariffs with a stated objective of raising annual bilateral trade to $30 billion by the end of 2015, which would double the trade volume from 2013. I have written in the past about the power imbalance between the two due to Turkey’s over reliance on Iranian oil and gas, which is one of the primary reasons Turkey was such a willing partner in helping Iran evade sanctions by swapping gold for gas. The desire to boost commercial trade with Iran has only grown with the loss of Syria as a trade conduit, and thus Turkey has pressed forward on working to expand economic ties with Iran despite an effort among its NATO partners to isolate Tehran economically.
Like with Syria, the rial signs in Ankara’s eyes have blinded it to some larger geopolitical truths. Turkey and Iran have a shared interest in stamping out the threat from ISIL, and they have each played a big role in keeping Hamas alive and boosting its standing in relation to the Palestinian Authority, but otherwise they are operating at cross-purposes. While Erdoğan has stated his conviction that Iran’s pursuit of nuclear power is for civilian purposes only, Turkey has a longstanding policy of opposition to an Iranian nuclear bomb. Turkey and Iran are on opposite sides of the ledger in the struggle for hegemony in the region, with Iran wanting to limit the influence of a connected Sunni bloc and Turkey teaming with Qatar to boost Muslim Brotherhood and other Sunni Islamist movements. As a NATO member and EU aspirant, Turkey is ostensibly in the Western camp while Iran is decidedly not. On Syria and Iraq, which have been the two most pressing hot spots in the region, Iran has strongly backed both Assad and Nuri al-Maliki, while Turkey has turned a blind eye for two years to groups like ISIL all in the name of ending Assad’s rule and clashed with Maliki repeatedly and consistently while he was at the helm in Baghdad. In short, you have two populous non-Arab states with the largest militaries in the region who differ on nearly every policy issue of consequence and who have historically each tried to control the Middle East, and yet Turkey has treated Iran with all due deference.
I have no insider insights into the status of the P5+1 talks with Iran, but given the frantic NATO/EU focus on Ukraine and the emergent ISIL problem occupying the White House’s attention, this would be the perfect time for a revisionist state such as Iran to take advantage of the chaos and take a harder line in talks or restart elements of its nuclear program. The spotlight at the moment is elsewhere, and given the previous extension of the deadline following the interim Geneva agreement, Iran would not be out of line in assuming that the U.S.’s priority is to get a deal even if it means letting up on issues such as enrichment. The upshot of this is that with other foreign policy problems eclipsing Iran’s nuclear program and an improved economic situation following the loosening of sanctions, Iran’s position is improving, which should worry Turkey deeply in a wider regional context. There is no question that Erdoğan and Davutoğlu both pine for the days of Ottoman power and would like to restore Turkey to what they see as its rightful role as regional leader, and a stronger Iran is not something that will help this project.
Turkey’s Iran policy up until now has been assume, like it did with Syria, that it can ignore the problems on the horizon and simply manage an ascendant Iran on its own. As with Syria, this has the potential to blow up in Ankara’s face in a big way, particularly once Iran no longer needs Turkey as an escape hatch out of its economic isolation. Whereas Turkey is reliant on Iran for its energy needs because it has no other viable suppliers yet, Iran is only reliant on Turkish capital and investment so long as it is under sanctions. Ankara’s assumption that Iran is always going to be a relatively friendly and cooperative neighbor flies in the face of the way regional powers operate, particularly when there is a power vacuum in the region in question. Erdoğan and Davutoğlu thought that they could manage Assad and that they could ignore ISIL outright, and that both problems would eventually melt away. They were wrong on both counts, and if Turkey keeps on treating Iran with kid gloves rather than realizing the threat that a powerful Iran presents to Turkish interests, it is ultimately going to end up with yet another foreign policy problem that it could have fended off with some foresight earlier in the process.
Israel’s Unnatural Dreams For Its Natural Gas
October 23, 2013 § 6 Comments
On Monday, Israel’s High Court cleared the way for Israel to export 40% of its new natural gas bonanza after rejecting petitions that challenged the government’s export plan. The Israeli government harbors high hopes of reaching $60 billion in profits over the next two decades from natural gas exports, and so the High Court’s decision is being celebrated as paving the way for an economic windfall. The problem is that there are some very big and intractable regional issues that have to be settled before Israel sees even a shekel from gas exports, and the prospect for all of this coming together is quite slim. If anything, Israel’s natural gas fields are going to end up sparking competition and regional destabilization rather than the opposite.
There are two ways for Israel to export its natural gas. The first is via pipeline to Turkey and hooking up with the planned TANAP or TAP pipelines in order to send Israeli gas to the rest of Europe. The prospects of Israel and Turkey cooperating on a pipeline deal at this point are laughable when the two sides cannot even agree on something as basic and simple as compensation for the Mavi Marmara deaths, not to mention the most recent unpleasantness between the two countries. Let’s assume for a moment though that cooler heads are able to prevail and mutual economic interests override the basic domestic politics of both countries, there is still a thornier problem of geography. A pipeline from Israel to Turkey has two possible routes. The first runs through Lebanon and Syria, which is a non-starter for all sorts of obvious reasons. The second route is undersea and has to travel through Cyprus’s exclusive economic zone. Given the animosity between Turkey and Cyprus and Turkey’s adamant insistence that is does not and never has occupied any part of Cyprus, reconciliation between these two parties over an issue that has been dubbed a diplomats’ graveyard is not on the horizon. It is true that there are many good reasons for a deal to happen, from the fact that there is a lot of money at stake to the fact that Turkey is completely isolated on the Cyprus issue and is the only country in the world that even recognizes the Turkish Republic of Northern Cyprus as an independent state, but that doesn’t mean that movement is imminent. Greek Cypriots overwhelmingly rejected a painstakingly negotiated federal model in 2004, and there is no reason to think that opinion on this has changed. What this means is that a pipeline, which would be the most cost-effective and easiest solution, is out for now.
The other way for Israel to export its gas is to liquify it and ship LNG to Turkey and other destinations. This comes with its own set of challenges as well. The first is that liquifying natural gas is an expensive process that reduces profit margins as compared to shipping it via pipeline. On top of the process itself, it requires building an LNG terminal that takes approximately 3-5 years to build and costs somewhere between $5 billion and $10 billion, which cuts into profits even further. An LNG terminal is unlikely to be built in Israel itself due to legal and environmental challenges, which again leaves Cyprus as the natural partner, but absent reconciliation between Turkey and Cyprus, shipping LNG to Turkey from a Cypriot LNG terminal is likely off the table. Without a Turkish market for gas, Israel is not going to expend the time and resources to build a LNG terminal in Cyprus to then have it essentially be bricked. Even assuming that Turkey and Cyprus are able to patch things up and Israel goes the LNG route, the security challenges posed by protecting an Israeli LNG terminal that is in Cyprus rather than in Israel and then protecting Israeli tankers plying the waters of the Eastern Mediterranean are enormous. Israeli ships carrying Israeli natural gas are immediately going to become an attractive target for all manner of jihadi and terrorist groups, and the Israeli Navy does not now have the capacity to protect such a potentially large venture.
So the bottom line is that a boom in natural gas exports is not assured by any means. No matter which way Israel turns, the path to huge profits from natural gas is complicated by geopolitics that have so far proved immune to easy resolution. In the short term, the answer is likely to send natural gas to Jordan, which will be profitable to a limited extent since Jordan is not a very big market. Another cheap alternative with much larger potential is to export to Egypt, but despite Energy Minister Silvan Shalom’s insistence that this avenue is open, the Egyptians claim that they have no interest in buying Israel’s natural gas.
Looking at the bigger picture, Israel’s long term problem may be more serious than simply not having a viable market for its exports. Turkey and Egypt both project very high growth in energy demand with no real energy resources of their own at the moment, and they are sitting next to countries – Israel and Cyprus – that are resource rich and with whom they do not have great relations. In addition, there are claims on Eastern Mediterranean gas fields being made by Lebanon and by the Palestinians in Gaza, not to mention Northern Cyprus’s claims to the fields claimed by the Cypriot government. How these tensions will be resolved is unclear and anyone’s guess, but a very combustible situation is developing, and the idea of major resource conflict at some point is not all that far-fetched. Should the Israel-Turkey-Cyrpus triangle not get resolved to each party’s relative satisfaction, the Eastern Mediterranean may very well become a lot less placid.
Why Isn’t Russia Freaking Out Over NATO Patriots In Turkey?
December 5, 2012 § Leave a comment
Following a meeting of foreign ministers yesterday, NATO gave its ok to deploy Patriot missile batteries to Turkey in order to guard against a missile attack emanating from Syria. While this is welcome news in Ankara, it is a move that Russia has been complaining about and trying to sandbag ever since Turkey made its initial request for Patriots last month. Russia’s concerns over deploying Patriots to the border with Syria are twofold and both fairly obvious. First, as Syria’s external patron, Russia wants to avoid intervention by any outside actors, and it has been afraid that sending Patriot missiles to Turkey is a precursor to wider action on the part of outside powers. Second, the fact that the Patriots are coming from NATO adds to Russian paranoia. NATO is and always has been a sore spot for Moscow, and understandably so. The organization that was formed during the Cold War as a way of containing the Soviet Union did not disband once the USSR broke apart and its raison d’être no longer existed, but actually expanded and in the process encircled Russia even more. Despite repeated American and Western assurances that this was not aimed at tamping down Russian power, Russia has never quite believed this version of events, and so it reflexively opposes any increased NATO presence in its backyard or in any situations in which it is intimately involved.
Nevertheless, following NATO’s decision to send Patriots to Turkey, Russia actually downplayed its criticism. At a press conference in Brussels after a meeting of the Russia-NATO Council, Russian Foreign Minister Sergey Lavrov said that Russia did not object to the Patriot deployment but that it did not want the situation with Syria to escalate any further. Lavrov was clear that Russia differs with NATO on issues of missile defense, but Moscow has apparently decided not to take a hard stand in this particular instance. The reason for this is partly because NATO has made it abundantly clear that placing Patriots on the Syrian border is not in any way a harbinger of an eventual NATO intervention, but is rather a measure designed to placate and reassure a skittish Turkey. The Patriots have been programmed so that they can only intercept missiles crossing over into Turkish airspace and cannot cross over into Syrian territory preemptively. If it had not already been clear enough, the NATO foreign ministers issued a statement emphasizing that the Patriots would not be used offensively in any way and will not be linked to any theoretical no-fly zone. While Russia is still not thrilled with the development, the effort to reassure the Russians that the Patriot missiles do not herald Western states actively intervening on behalf of the rebels in the Syrian civil war seems to have paid off.
There is, however, another reason that Russia is all of a sudden displaying a more pliant side, and it has to do with Turkish energy demands. As sanctions have kicked in on Iranian oil, Turkey has been meeting its vast and ever growing energy needs with Iranian natural gas, and it has been buying that gas with gold in an effort to evade the ban on financial transactions with Iranian banks. In response to Turkey’s end around, the Senate is considering a new sanctions bill that would cover the sale of precious metals to Iran, and while Turkey insists that it will continue buying up to 90% of Iran’s natural gas exports, at some point the White House is going to be forced to take a tougher line with Turkey given the pressure from Congress over the issue. As I wrote back in April when looking at Turkey’s energy trade with Iran, Turkey’s biggest oil supplier is not Iran but Russia, and if Turkey is forced to look elsewhere for its natural gas needs, Russia is the logical partner. There are signs that Turkey is preparing for this very eventuality, as it has asked Russia to increase its natural gas sales to Turkey by 3 billion cubic meters per year, which does not entirely replace the 10 billion cubic meters per year that Turkey gets from Iran but significantly cuts into it. Russia wants Turkey to buy more of its gas at Iran’s expense, and this may partially explain Russia’s backing down from its strident stance on NATO deploying Patriot missiles in Turkey. Russia wants to keep Turkey as a happy client, and if placing some defensive missile batteries along the border with Syria are the price of doing business, Russia has concluded that the pros outweigh the cons.
Turkey and Iranian Oil
April 26, 2012 § 6 Comments
One of the obstacles, if not the largest obstacle, to peeling Turkey away from Iran is the economic ties between the two, particularly when it comes to energy. Turkey imports 90% of its oil, and Iran was its largest supplier until 2007 when Russia took the top spot. Through March of this year, Turkey was importing 200,000 barrels per day from Iran, which accounted for 30% of Turkey’s oil imports and 7% of Iran’s oil exports. This is obviously a huge barrier for the U.S. to gaining closer cooperation from Turkey in pressuring Iran over its nuclear program, and the announcement last month that Turkey was slashing its oil purchases from Iran by as much as 20% was accordingly a big deal.
Turkey does not import oil from Iran because it is necessarily a supporter of the regime, but because Iran has been a convenient source. There are, however, real bilateral energy issues between the two that make Turkey receptive to U.S. entreaties to get its oil from elsewhere. Turkey consumes around 1.3 trillion cubic feet of natural gas annually and it imports 24% of its gas from Iran, but Iran charges Turkey more than $500 per 1000 cubic meters of gas, which is more than it charges any other country and $100 more than the market price. In contrast, Turkey pays $350 for gas from Azerbaijan and $400 for Russian gas. Turkey is stuck because it signed a 25 year deal with Iran in 1996 and because it has no way of replacing Iranian gas imports, which Tehran knows full well, and in the last few weeks Turkey has taken Iran into international arbitration over its natural gas price gouging. The gas price has become an even bigger problem in the past year as energy prices have risen across the board fueled by insecurity about global energy supplies, which led to a 40% increase in Turkey’s energy imports in 2011 as compared to 2010. The point here is that Turkey may very well be actively looking into ways to reduce its reliance on Iranian oil anyway, U.S. pressure or not. The agreement to buy oil from Libya in conjunction with reducing Iranian imports is a good first step, since it gets Turkey’s foot in the door with the new Libyan government, and might eventually lead to Saudi concessions on price as well.
It is in this context that today’s news that Turkey is starting oil and gas drilling in northern Cyprus should be viewed. Obviously this is partly a response to Cyprus’s own oil and gas exploration, but TPAO’s drilling is not merely symbolic. Turkey’s energy needs are enormous and growing, and the question is whether it will have to continue relying on Iran or if it can fill the gap somewhere else. If the answer ends up being the latter, it will have the effect of isolating Iran further and making a resolution to the nuclear issue that does not involve military strikes more likely. To that end – and to continue beating a dead horse from previous posts – a Turkish-Israeli rapprochement would help Turkey soften the blow from Iranian natural gas once the Tamar and Leviathan natural gas fields are up and running in 2013. In any event, keep an eye out for Turkey exploring any possibility open to it as far as oil and gas are concerned, since that will yield clues as to how the Iranian nuclear standoff is likely to be resolved.
