For the New Year we should look on the brighter side. Certainly the political attacks on Israel are escalating in Europe and at the UN. But every cloud has a silver lining.
Jack Cohen
Specifically for Israel the drastic drop in the price of oil is a good trend. The price of a barrel of crude oil went from ca. $75 to ca. $45, a drop of 40% in the course of a few months. It is happening because there is now a glut of oil on the market, because of new finds and improved methods. The discovery of huge shale oil deposits in N. Dakota has made the US independent of foreign (Arab) oil and the use of fracking (carrying out controlled explosions underground to fracture the rocks and release trapped oil) has increased the supply.
At the recent meeting of the oil cartel OPEC there was no agreement about what to do, as the income of oil countries, notably the Arabs and Russia, has been almost halved. The obvious thing to do is cut production to drive the price up, but several countries led by Saudi Arabia refused to do this because they are afraid that if they cut production they will lost market share that they will never be able to recover. Also, if the price of oil remains low this means that alternative energy technology, such as wind and solar power, become less economically competitive and the Saudis are hoping to undercut these developments.
Anyway, the supply of gas and oil that has been discovered off the coast of Haifa (the Leviathan and other fields) is now flowing into Israel, and will make Israel also largely independent of foreign suppliers. Also, Israel is now going in for solar power in a big way. A new solar energy field has been built in the south near kibbutz Ketura that should supply all of the electricity needs of the south of Israel. Note that the production of relatively cheap and abundant electricity will allow the desalination of water to increase the supply of drinkable water in arid zones, making Israel independent in that area too.
In addition, the project of building a new railway line from Beersheva to Eilat is proceeding, carried out by the Chinese. Their interest is to use railway transport to bypass the Suez Canal. Their ships will tie up at Eilat and transfer their goods in containers to trains that will take them to Ashdod where they will be offloaded into ships to take them to Europe. This will be quicker and cheaper than shipping them thru the Suez Canal in Egypt. The Egyptians are aware of this development and are in the process of building a new Suez Canal parallel to the old one in order to reduce the waiting times for ships to transit the Canal, that is costing the Chinese huge sums of money for the shipment of their goods to Europe.
In relation to Gaza, two things have changed since before last summer’s war with Hamas. Much of Hamas’ weapons and cache of missiles were destroyed and now they are unable to replace them because the Egyptian regime has closed the tunnels under the Gaza-Egyptian border and Hamas is unable to smuggle in the missiles as they did before, so they are unable to replenish their stocks. Also, although a Conference on Gaza promised b$5 to reconstruct Gaza, to date only 2% of that money has actually been donated. Also, it has been reported that Hamas is diverting some of the construction materials to repairing their tunnels and this has caused Israel to reduce the flow of building materials until this can be stopped.
Finally, progress is being made in military actions against the Islamic State, the Pesh Merga Kurdish forces broke through and relieved the siege on Mt. SInjar, and even the Iraqi Army has had successes. These have been accompanied by many hundreds of US and allied air sorties against the ISIS forces, including on their capital at Raqqa, that has killed many IS leaders.
The current visit of Sen. Lindsay Graham, a leading Republican in the US Congress, presages an improved relationship with the US. These changes help Israel to be more viable, but while the economic horizon looks good, it is the political horizon that is troubling. Let’s hope things improve in 2015.
Jack Cohen: Born in London, UK, lived in suburban Washington DC area for 30 years, moved to Israel in 1996. He has a web site: Jack’s Blog
Jack Cohen
