Jordan’s Gas Law and the Regional Energy Balance
The Parliamentary Committee on Energy and Mineral Resources of the Jordanian government is currently reviewing the proposed Gas Law 2025, which, within the framework of existing sectoral agreements with Israel, would benefit both parties. The initiative aims to comprehensively modernize Jordan’s gas system, including importation, transportation, storage, distribution, and commercialization.
In addition, the proposal envisages the incorporation of other types of gases into the market, such as natural gas, biogas, bioethanol, and hydrogen, with the objective of transforming Jordan into a regional energy hub.
In the Jordanian parliamentary report, Israel is not explicitly mentioned as a partner. However, given that Israel is one of Jordan’s main gas suppliers and that a gas pipeline agreement exists between the two countries, this law would facilitate importation, transportation, tariff-setting, and the signing of new contracts between the parties.
Potential Impact on Gas Supply and Transit Toward Israel
Although Israel possesses significant natural gas reserves, the law proposes focusing on the regulation of gas transit and export systems, facilitating and clarifying the standards applicable to transit agreements and related processes. This creates an opportunity not only to continue exporting gas to Jordan, but also to access other markets from there.
The rationale is clear: the new law will establish a system of permits and licenses, facilitate contract execution, and require transparent disclosure of information regarding tariffs and fees. This will benefit companies interested in selling gas to Jordan in the future, while allowing Jordan to continue purchasing gas from Israel with greater legal certainty. Moreover, it will reduce the risk of transaction cancellations resulting from improvised political decisions.
Opportunities for Energy Cooperation
With these new advantages, the law will position Jordan as a safer destination for foreign investors. Greater contractual and regulatory clarity will allow them to access a more transparent and competitive market.
Israel, for its part, would be able to operate in a more secure and attractive environment for its companies in Jordan, with opportunities for the development of joint infrastructure projects, such as liquefied natural gas (LNG) plants, as well as gas storage or transportation facilities between the two countries.
This would also have an impact on prices, as increased gas availability in Jordan would influence regional trade dynamics and competition. On the other hand, if Jordan succeeds in exporting gas to neighboring markets such as Egypt or beyond, Israel could become a direct energy competitor, affecting pricing dynamics across the region.
Shared Interests
Israel and Jordan share strategic interests in energy stability and reliable supply. In this context, a Jordan equipped with a solid regulatory framework and more developed gas infrastructure can offer greater supply options and enhanced bilateral cooperation, thereby contributing to strengthened regional energy security.
Conversely, if Jordanian legislation excessively favors nationalization or strict state control of the sector, flexibility for gas imports and exports from Israel could be limited, negatively affecting such cooperation.
Conclusion
Jordan’s Gas Law project has the potential to generate positive or, at worst, neutral effects for Israel, depending primarily on how licensing regimes, transit regulation, and associated commercial agreements are implemented. A flexible and transparent application could open opportunities for Israel through gas exports, cooperation on infrastructure projects, and joint development of clean energy technologies.
However, if the regulation results in strict regulatory barriers or excessive state control over transit and exports, these opportunities could be constrained, increasing costs and reducing the competitiveness of Israeli companies in the regional market.
