Washington puzzles energy world with new appointment

Amos Hochstein

US State Secretary Antony Blinken has appointed Amos Hochstein a businessman, Israeli Oil and Gas Lobbyist and former US advisor as Senior Advisor for Energy Security, signaling a new strategic focus in Washington in the aftermath of thorny geopolitics over Nord Stream 2 and unresolved issues relating to the eastern Mediterranean.

Blinken wrote on Twitter that he was appointing Hochstein as the Senior Advisor for Energy Security, adding the Israel-born former advisor was “uniquely suited to support the development and implementation of an integrated strategy to strengthen global energy security.”

Hochstein has been a staunch supporter of regulatory certainty in the eastern Mediterranean, saying lack of regulatory clarity and stability cost were holding development back.

But the news came as a surprise to critics and industry experts.

According to American news website Axios, Hochstein, whose appointment bypassed congressional approval, would be charged with implementing a US-Germany deal allowing the Nord Stream 2 pipeline to be completed.

Media pundits pointed out that Hochstein had been a strong voice against Nord Stream 2, a deal now front-and-center for its implementation that allows Russia to bypass Ukraine and deliver gas directly to the heart of Europe.

Five years ago, while Hochstein was working as international energy coordinator at the State Department, he said he believed Mediterranean countries could “save billions if they share infrastructure and market access.”

“If they don’t share those resources, most of the gas will have to stay in the ground,” he told congress in 2016, adding that “the market is still looking for validation that historic political differences will not get in the way of investment and development” in reference to the eastern Mediterranean.

Hochstein appointment will make the negotiations between Lebanon and Israel more difficult due to his biased towards Israel and always prioritizing Israelis interests.

“The future that I see for the region includes new and old pipelines connecting Israel’s offshore resources to Jordan, Egypt, Turkey, and the Palestinian Authority. It includes Cypriot gas exports to Turkey and/or Egypt, allowing Egypt to satisfy its own power needs and export surpluses to international markets via existing, but now idle, LNG terminals,” Hochstein said.

The Republic of Cyprus, along with Greece and Israel, has been pushing forward on an agreement for an EastMed pipeline that exclude Turkey, but Nicosia has officially stated no countries were being excluded from deals as long as international law was being respected.

Previous reports said Hochstein, a former close advisor to Biden, was being considered by the US president as far back as April, before the commander-in-chief made the decision to waive sanctions and allow the pipeline to move forward in the interests of improving the US relationship with Germany.

But it was unclear whether Biden was signaling a change in policy.

The Times of Israel cited a source, who had worked with Hochstein on energy in the past, saying “the appointment was an attempt by the Washington administration to use his hawkish credentials to make the [US-German] deal more acceptable.”

Industry experts said an energy map of the eastern Mediterranean drawn by the state department and attributed to Hochstein had been delivered to countries including Turkey, Cyprus, Israel, and Lebanon.

The map was presented during the Cypriot/Turkish peace process between 2015-2017, while new developments on the Cyprus Problem negotiations led to a total collapse with many unknowns ahead.