Israel’s ties with Egypt went up in flames this week, like so much natural gas burning in a sabotaged pipeline. Indeed, Egypt has sabotaged its ties with Israel – and the blowback will leave scars.

The sudden announcement of the cancellation of the deal to supply Israel with Egyptian natural gas had officials in both Jerusalem and Cairo rushing to “explain” away the thing as just some ho-hum business dispute. But the political implications quickly became glaringly apparent.

On the face of it, the Egyptians were merely frustrated by the economic conditions of the deal, as rising prices in the natural gas market have made the 2005 contract look more and more like a bargain for Israel and, therefore, an embarrassment for Egypt.

It was convenient, also, for Egyptians to blame their frustrations on the toppled government of Hosni Mubarak. After all, corruption seems likely in a pact that created instant fortunes for Mubarak’s sons and cronies. (For the record, the folks on our side of the deal don’t look like boy scouts, either.)

But even a bad deal can still be good in the end. This one brought Egypt billions of dollars from a dependable client on its own back porch. And the “losses” that Cairo politicians had originally bemoaned were soon mitigated when the Egyptians strong-armed Israel into a nearly 50% price hike.

It would be reasonable to assume, then, that Egypt could have worked out a compromise with Israel, if only a modicum of diplomatic good will were flowing together with all those billions of cubic meters of natural gas through the Arish-Ashkelon pipeline.

Alas, there wasn’t.

If a long list of slights and insults – inaction in the face of Hamas arming itself through tunnels in Sinai, officially endorsed blood libels against Israel, public disdain for a peace partner that selflessly helped Egypt save water, grow more crops and lose less livestock to disease, etc. – were not enough to prove that point, then perhaps another incident this week will.

During a presidential election campaign already marked, in part, by candidates who use their anti-Israel stances to gain the public’s trust, Egypt’s military leader Muhammad Hussein Tantawi unleashed a threat to “break the leg” of anyone (read, “Israeli”) who approaches Egypt’s northern border.

Field Marshall Tantawi, the head of Egypt’s Supreme Council of Armed Forces and the country’s de facto leader, was enraged that Israeli Foreign Minister Avigdor Lieberman had had the audacity to suggest, in a letter to Prime Minister Benjamin Netanyahu, that the escalating lawlessness in Sinai and chaos in Cairo posed a threat to Israel “much more disturbing than the Iranian problem.”

Tantawi’s bluster, like the fury that Egyptian politicians displayed against Israel this week, is misplaced.

Egypt should be rallying against the threat posed by armed Bedouin gangs that sabotage the natural gas pipeline, demand protection money from Sinai businesses and carry out bombings of tourist sites along the Red Sea. Egypt should rise up to thwart the incursion of Islamist terrorist groups into Sinai, whose attacks against Israel threaten the stability of the peace treaty. Egypt should marshal its forces to seal off the southern border – across which have poured not only the tens of thousands of African migrants who have flooded Cairo and snuck into Israel, but teams of Sudanese assassins sent by the government to kill Mubarak. Egypt should be vigilant about the flow of weapons and drugs from Libya, to the west.

It isn’t, though. Instead, Egypt treats as an enemy the country that buys its natural gas, patronizes its resorts, improves its farms and establishes factories in its employment-starved towns. Egyptians regularly burn Israeli flags in the streets, so setting fire to a lucrative energy deal this week must have seemed just a minor step. But now it will have to sit in the ashes.