Iran-Israel War and East Med Energy: Between Resilience and Vulnerability
Leslie’s Three Main Takeaways
Leslie’s Three Main Takeaways:
Israel’s power mix shows resilience despite the shutdown of key sites
Egypt and Jordan are highly vulnerable to the ongoing war, especially due to precarious energy balances and halted pipeline gas imports from Israel, compounded by LNG disruptions
Iran’s deepening energy crisis could be its Achilles’ heel. Israel could strike further at Iran’s oil and gas infrastructure to destabilize the country from within
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Israel’s Power Mix Shows Resilience Despite Shut Down of Key SitesIsrael’s domestic market continues to be powered by natural gas. The Tamar field remains online, while Leviathan and Karish have been shut as a precaution due to security threats.
Oil supply appears manageable for now. Haifa’s oil refinery shut down following Iran’s missile strike; Ashdod’s refinery had already been taken offline for maintenance prior to the attacks, contributing to healthy inventories.
Fuel demand is down as the civilian population has largely stayed home this past week, reducing the use of cars and planes.
Israel’s power mix is more resilient thanks to diversification. While nearly 71% of generation relies on natural gas, coal and renewables provide critical back-up (15% and 14% respectively). Solar, which makes up 95% of Israel’s renewables, is running at full capacity thanks to the summer season.
Egypt and Jordan Are Highly Vulnerable, Especially Due to Precarious Energy Balances
East Med Ripple Effects: Gas pipeline exports from Israel to Egypt and Jordan have been halted, deepening both countries’ energy crises. Roughly 80% of Leviathan’s output is normally exported to these two neighbors, but flows have been shut since Friday, June 13.
Egypt’s energy Vulnerability:
Domestic gas production remains low—currently around 43–46 bcm/year, down from 65 bcm/year in 2022—while consumption continues to exceed 60 bcm/year.
Pipeline imports from Israel (~10 bcm/y) have stopped.
Egypt will need to import over 4 mtpa of LNG (5.5 bcm/yr) to meet demand. Since Spring 2024, it has returned to being a net LNG importer.
Only one FSRU—the Hoegh Galleon, located at the Sumed port in Ain Sukhna—is currently operational.
Any delay in LNG imports or prolonged halt in pipeline supplies will heighten Egypt’s energy insecurity.
The country had secured 160 LNG cargoes through 2026 just before the war began.
Make sure to listen to my latest emergency Energy Vista podcast on Iran-Israel War & Regional Gas Market Risks. I speak with Israeli gas expert Gina Cohen about the latest war developments, impacts on trade flows, infrastructure security, and investments.
➡️ Listen now wherever you get your podcasts (Apple, Spotify and YouTube)
Iran’s Deepening Energy Crisis Could Be Its Achilles’ Heel
Israel may strike further Iran’s oil and gas infrastructure to destabilize the country from within.
Iran’s energy crisis has been long in the making—despite holding the world’s second-largest natural gas reserves—driven by sanctions, chronic mismanagement, underinvestment, aging infrastructure, and an overreliance on natural gas for power generation.
A prolonged energy crisis would deepen economic hardship, fuel political tensions, and embolden public protest—further destabilizing Iran’s already fragile social cohesion and regime’s legitimacy.
Pipeline infrastructure attacks: In February 2024, targeted Israeli attacks reportedly destroyed two major gas pipelines in Iran, covering 1,200 kilometers and carrying 2 bcf/d according to the NYTimes. These attacks had removed at the time 15% of Iran’s daily natural gas production.
Gas production hit: Iran partially suspended gas production at the South Pars 14 gas field on June 14 2025, after an Israeli strike triggered a fire, halting the output of 12 million cubic metres (mcm) of gas per day.
Grid Fragility: Sanctions have severely limited Iran’s ability to import new equipment or attract foreign investment. As a result, the electricity grid is outdated, poorly maintained, and vulnerable to even moderate demand shocks or facility failures.
Seasonal Strain: Summer heat could intensify electricity shortages. Alternative outlets have reported widespread outages across Iranian cities since the beginning of the year, including the entire Tehran Province.
