A monthslong standoff over a $35 billion gas deal between Israel and Egypt finally ended in the closing days of the year when Prime Minister Benjamin Netanyahu announced on Dec. 17 that his government had approved a historic expansion of gas exports to its southern neighbor.

For Egypt, the breakthrough brings short-term relief despite longer-term questions. The agreement is a critical stopgap as Cairo grapples with declining domestic gas production, rising electricity demand and mounting pressure to avoid summer blackouts, which have become a major political liability for President Abdel Fattah al-Sisi since 2023. 

At the same time, Israel’s delay tactics and repeated interruptions to gas flows since late 2023 have underscored a sobering reality: Egypt’s growing reliance on Israeli gas is both nearly unavoidable and increasingly risky.

First announced in August, the agreement was quickly frozen amid Israeli political maneuvering tied to the Gaza war and broader bilateral tensions. Energy Minister Eli Cohen blocked the deal, arguing that Israel’s interests were not adequately protected, and he demanded that companies commit to supplying gas to Israeli consumers at low prices.