Energy and Our World

This article originally ran on Forbes.com on March 18, 2024. All rights reserved.

Daniel B. Markind is a Forbes.com energy column contributor. The views expressed in this article are not to be associated with the views of Flaster Greenberg PC.

One wild card of the Middle East equation has been Hezbollah, the Iranian-inspired Shiite terror group /political party in Lebanon. Considered the most fully armed non-state actor in the world, Hezbollah possesses an arsenal that includes an estimated 150,000 rockets, almost all aimed at Israel. Ever since October 7, 2023, when Hamas invaded Israel and sparked the current Gaza war, many eyes have been not on Gaza, but on the Israel-Lebanon border to the north. Would Hezbollah join in the fighting and turn a rather localized conflict into a fully regional war? To date, Hezbollah has stepped up significantly its rocket and rocket-propelled grenade attacks against Israel, but this has not erupted yet into a full-scale war as seen in Gaza. There are many possible reasons for this, but one might be the presence of natural gas located offshore along the Israeli-Lebanon border.

Politically and economically, Lebanon is a disaster. It is a nation whose very existence rests on the control, if not mutual acquiescence, of three carefully balanced groups, Christians, Sunni Muslims and Shiite Muslims. By historical convention, but not formal law, the President is always a Christian, the Premier a Sunni Muslim, and the Speaker of the National Assembly a Shiite Muslim (Source). Over the years, the population balance among the three groups has changed, with Shiite Muslims becoming more numerous.  As this has happened, the Shiite-dominated nation of Iran, whose governing Ayatollahs are dedicated to the destruction of Israel, has continued to train, equip, and fund a non-governmental actor, Hezbollah (“Party of God”), which originally declared itself the protector of the persecuted Shiite community and then the protector of Lebanon itself against the enemy Israel.

Ever since 1975, when civil war erupted among the major Lebanese factions, the nation has been unstable.  Since Hezbollah began being armed by Iran and helped drive out the Israelis in 2000 (they had invaded in 1982), Hezbollah also has been a major factor, although crucially its military power is not under common command and control as the Lebanese Army.

During these last nearly 50 years, the Lebanese factions have rarely been able to form an effective government. Hezbollah often has acted as the spoiler, refusing to accept any government construct that limits its power in any way. Now effectively armed more fully than the Lebanese army itself, Hezbollah in many ways is a “state within a state.” Since 2022, Lebanon really has had no functioning government at all.

Things reached the height of absurdity in March 2023, when daylight savings time in Lebanon coincided with the Fast of Ramadan, where Muslims are not allowed to eat or drink when the sun is up. Not wanting to inconvenience its believers further, the Muslim organizations asked for a delay in going onto daylight savings time until Ramadan was over. At the last minute, caretaker Prime Minister Najib Mikati announced that Lebanon would, indeed, delay going onto daylight savings time. This infuriated the Christian community. The result was mass confusion about which time it was, as non-governmental entities refused to delay the time change (Source). In one bizarre situation, each side of a two-sided clock at Beirut’s International Airport showed a different time. Finally, after ridicule, humiliation, and anger, Mikati backed down and Lebanon went onto daylight savings time after all.

This same sort of governmental incompetence and political compartmentalization has brought the Lebanese economy to a standstill (Source). Since 2019, Lebanon’s Gross Domestic Product has collapsed by 50%. Over 80% of the population now lives below the poverty line. With no functioning government, a population divided by ethnicity, and an army that is outgunned by an irregular force within its own borders, the finding of natural gas deposits offshore came as a godsend to Lebanon. 

Plans to develop the fields, known as “Karish” on the Israeli side and “Qana” on the Lebanese side, were first proposed in 2017. Once proposed, they quickly ran into political obstacles as the maritime border between the countries has never fully been demarcated. Estimates are that the Qana field could produce $3 Billion, sorely needed by the Lebanese economy (Source). The development of these fields became even more important to the world following Russia’s invasion of Ukraine in February 2022, forcing much of Europe to seek alternative sources for its natural gas.

Talks between Israel and Jordan on reaching a maritime border agreement began in 2020. They quickly foundered for political reasons. However, the desperate state of the Lebanese economy and the potential of Qana were so extraordinary that the Lebanese factions actually came together in late 2022 and signed an agreement with Israel to demarcate the maritime border and allow for offshore development (Source). Almost immediately after signing, Lebanon announced that the French company Total would soon begin development. The Lebanese government hoped and hopes that this money from natural gas development can be used to raise some of its people from poverty and take pressure off the political establishment that has been so unsuccessful in dealing with the country’s problems.

That is all at risk now, indeed as a figurative hostage of the Gaza war. Israel has let it be known to Lebanon that, unless Hezbollah quits firing into Israel and retreats back north of the Litani River, as required by UNSC Resolution 1701, Israel will terminate the 2022 agreements. That could end any possibility of natural gas development for Lebanon for the realistic future, which would be a crippling blow to the already reeling country.

Overall, Lebanon’s population is divided and fearful over the possibility of war with Israel (Source). There is no overriding issue causing any war, except the fact that Hezbollah often seems to act as an arm of Iran.  Many in the Sunni and Christian communities do not want their lives sacrificed for the needs of this Shiite organization that doesn’t even represent all in the Lebanese Shiite community itself. They have been vocal In telling Hezbollah that there is little support for a war with Israel at this time, if ever.

Will the forces in Lebanon have enough power to convince Hezbollah to hold off hostilities with Israel and implement UNSC Resolution 1701? We do not know, but if so the fact that natural gas has been located in the Mediterranean surely will be a reason. If that happens, this could be one of those unusual times where countries do not fight over a disputed natural resource, but instead remain at peace because of it. Let us hope that is the case.