Israeli environment minister says UAE oil deal is blocked

Israel's Environment Minister said Thursday a clandestine oil deal that would have turned a scuba divers' paradise into a waypoint for Emirati oil headed for Western markets has effectively been blocked.

Tamar Zandberg told Israeli Army Radio that following a Justice Ministry opinion that her office had the authority to limit the activities of the Israeli government-owned corporation signed onto the deal, “the agreement cannot be realized.”

“The deal exists on paper but there is no way to realize it," she said. “They won't bring in more tankers than what the current permit allows. That is, the agreement cannot be realized.”

The secret deal would have significantly increased the number of oil tankers docking and unloading in the Israeli resort city of Eilat. It was struck last year between the Europe-Asia Pipeline Company, the Israeli government-owned corporation, and MED-RED Land Bridge, a joint Israeli-Emirati venture, following the historic agreement establishing formal diplomatic ties between Israel and the United Arab Emirates.

Senior officials in former Prime Minister Benjamin Netanyahu’s government — including his former energy, foreign and environment ministers — said they didn’t know about the deal until it was announced last year after the accords were signed at the White House.

Initially hailed as a move that could cement fledgling diplomatic ties and further Israel’s energy ambitions, the new Israeli government sworn in this year ordered a review. That followed an outcry from environmental groups, who warned the increased oil tanker traffic would threaten to eradicate the Gulf of Eilat’s coral reefs. The decision upset investors and risked a diplomatic spat with Israel’s Gulf allies.

During the review, the Environmental Protection Ministry froze the company’s planned expansion of operations, limiting the number of tankers allowed into the Gulf of Eilat and effectively blocking the deal.

Israeli environmental groups had asked the country’s Supreme Court to cancel the agreement and halt oil shipments, citing the corporation's questionable safety record and the risk posed by parking supertankers alongside Eilat’s fragile coral ecosystems. The groups pulled their lawsuit earlier this month following the Justice Ministry's decision to side with the Environmental Protection Ministry.

The pipeline company, known as EAPC, was founded in the 1960s to bring Iranian oil to Israel when the countries had friendly relations. Its operations are shrouded in secrecy, ostensibly for security reasons.