East Med Energy Outlook for 2021

As a tumultuous 2020 draws to a close, 2021 is coming to the East Med with a lot of expectations and hope.

Key factors that will shape the new year in the region are the succession of Joe Biden to the US presidency, EU’s green policies, economic factors, rapprochements and dispute resolutions, global oil and gas sector recovery and its impact on the East Med.

The Biden factor

With Biden in place as the next US President, the chances for conflict resolutions around the East Med will get a much-needed boost. In addition, the renewed importance of NATO under the new administration, and concerns about Russian influence, will focus attention to finding ways to deal with Turkey – but with NATO in mind, the Americans are likely to act with caution.

Nevertheless, Turkey should expect a tougher time with Biden than it had with Trump, especially with regards to civil liberties and human rights, as well as aggression towards its neighbors.

Biden is committed to fully integrate climate change into American foreign and national security policies, with global implications. This will mean that oil and gas are not likely to be driving factors in shaping future US policy in the Middle East and East Med regions.

The strategic importance of the Middle East to the US will diminish even further. The close relationship with Saudi Arabia and Israel will be placed on a different footing, with US interests taking priority – for example re-entering the Iran nuclear agreement and distancing from the Yemen imbroglio.

Under Biden, the United States will pursue a more ’hands-on’ involvement in the region, supporting negotiations and solution of disputes through diplomacy.

EU’s green policies

EU’s green policies will advance more rapidly, impacting fossil fuels, including natural gas. New rules will be announced making future funding of such projects unlikely – including the EastMed gas pipeline.

 

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