ArticleMarch 20264 min read

Cyprus, an energy alternative for Europe?

Christian Halaby

Published in Marine & Océans

Study Centre SMGM

Summary

With the disruption of the Strait of Hormuz, Cypriot gas and the maritime delimitation agreement between Lebanon and Cyprus take on a new strategic significance for Europe.

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Since the attack launched at the end of February by Israel and the United States against Iran, the strategic reading of Cypriot gas has changed scale. Nearly a fifth of global oil and liquefied natural gas flows pass through the Strait of Hormuz, and its disruption has caused prices to soar and brought energy risk abruptly back to the heart of European calculations. In this context, Cyprus no longer appears merely as an alternative to Russian gas, but as a Mediterranean route lying outside the Gulf corridor, and therefore relatively sheltered from the instability now affecting regional exports.

As Gulf infrastructure becomes a target of war, Cypriot resources gain in strategic value: not as an immediate solution, but as a bet on stability.

It is in this context that the maritime delimitation agreement concluded last 26 November between Lebanon and Cyprus is now changing in significance. After 18 years of deadlock, the two countries have officially fixed their maritime boundary. Presidents Joseph Aoun and Nikos Christodoulides welcomed the signing of a “historic agreement” strengthening bilateral cooperation, at a time when the energy geography of the Eastern Mediterranean is being redrawn at speed.

A EUROPEAN ALTERNATIVE TO RUSSIAN GAS

A few months before this agreement, Cypriot President Nikos Christodoulides had announced the forthcoming start of production at the “Cronos” gas field, estimated at around 70 billion cubic metres of natural gas, with exploration now able to extend east of the island following the signing of the agreement with Lebanon. Gas extracted from Cronos will be liquefied on the Egyptian coast and will reach the European Union (EU) market in 2027, a vital solution for a Europe still looking for an alternative to Russian gas. Indeed, current Cypriot reserves correspond for the EU to the equivalent of ten years of hydrocarbon supply through the Nord Stream pipeline, out of operation since the Russian invasion of Ukraine.

For the European Union, these developments are part of a broader strategy of energy diversification and independence launched since the start of the war in Ukraine, which the blockage of the Strait of Hormuz has now brought back to the fore. Brussels sees Cyprus as a future “Mediterranean hub” capable of linking eastern resources to its internal market, notably via Greece. We are still speaking of a potential alternative, since Cyprus has never yet exported gas. Nevertheless, the obstacles are rapidly being lifted, ensuring an increasingly favourable geopolitical framework and revealing a new priority, even an urgency, for the European Union.

THE ISRAELI-LEBANESE DEADLOCK RESOLVED

In 2007, the Lebanese Parliament refused to ratify the agreement delimiting the exclusive economic zone (EEZ) signed with Cyprus, citing reservations about the tripoint at the intersection of the maritime boundaries of Lebanon, Cyprus and Israel. It was only in 2022 that the situation reached a turning point, amid rising tensions between Hezbollah and Israel over the start of gas drilling in the offshore Karish field, located in the north of the Israeli EEZ. Indirect Israeli-Lebanese negotiations were initiated at the urging of the United States, which carried out a long and successful mediation, a rare occurrence between two states that do not recognise each other diplomatically.

It is this Cyprus–Israel–Lebanon tripoint, fixed through the 2022 agreement, that paved the way for the negotiations recently concluded between Cyprus and Lebanon. This clarification, now consolidated, gives Nicosia the visibility it needs to extend its exploration activities towards the eastern side of its EEZ, while allowing Lebanon to move forward on its own blocks to the north-west, long frozen by legal uncertainty. Finally, it offers international companies a legal framework stable enough to relaunch exploration operations and form consortia in consultation with the Lebanese government. However, the current war in Lebanon and the resulting security instability are, for now, relegating these energy prospects to the background.

ANKARA AND DAMASCUS OUT OF STEP

While the agreement is being celebrated in Beirut and Nicosia, it has nevertheless provoked hostile reactions on the Turkish side. Not recognising the government in the south of the island, Turkey quickly condemned the Lebanese-Cypriot maritime delimitation agreement, deeming it illegitimate and disregarding the rights and interests of Turkish Cypriots. Although the agreement does not concern the Turkish continental shelf declared to the United Nations, Ankara contests the exclusion of the self-proclaimed Turkish Republic of Northern Cyprus from the negotiations and official signatures. It is important to note that this entity has de facto control of the north of Aphrodite’s island and remains strongly influenced by Turkey.

Since 2003, the Turkish government has consistently condemned any bilateral agreement entered into without its approval or that of the Turkish Cypriot entity. The same applies to cooperation initiatives on the exploitation and export of gas in the Mediterranean, led by Egypt, Greece, Israel and Cyprus. Isolated from this diplomatic dynamic, the Turkish state is struggling to assert its role in maritime and EEZ issues in the Eastern Mediterranean. Behind these criticisms, however, the agreement opens a broader geopolitical sequence, driven by Cypriot energy ambitions.

Meanwhile, the Syrian file remains blocked. The transitional authority in Damascus, which Greece had already described as illegitimate to conclude international agreements during a draft Turkish-Syrian maritime agreement in 2024, shows no willingness to delimit its maritime boundaries, despite repeated calls from its neighbours to the south and north. This lack of commitment prevents any oil and gas exploration in the undelimited zone shared by Lebanon, Syria and Cyprus, and durably freezes the energy potential of this coastline.

In a narrow sea shared by many states, the Republic of Cyprus is establishing itself, through its geostrategic position, as an indispensable link between the Near East and the European Union.

It remains to be seen whether this new maritime balance will hold in the face of the competing ambitions of the coastal powers, and whether Cyprus will manage to turn this diplomatic momentum into a genuine energy lever for Europe.

Note on the author

Christian Halaby, aged 22, holds a degree in political science from Université Panthéon-Sorbonne, where he is pursuing studies in the economic analysis of development. Specialising in the geopolitical dynamics of the Middle East, he followed these issues at the United Nations Office on Drugs and Crime (UNODC) and at the United Nations Information Centre in Beirut. He also chaired the Association des Études du Développement (AED), active on international development issues. He is now a member of the university think tank Deep Blue, which specialises in maritime issues.