Where Is Egypt’s Relationship with Israel Headed? A Strategic Rift Begins to Unfold

As tensions rise between Egypt and the Israeli occupation, concerns mount over military developments in Sinai and accusations by Israel that Cairo has violated the security annex of the 1979 Camp David Accords. A recent geopolitical analysis published by Asbab Research Center highlights a potential strategic shift in the relationship between the two nations—a shift that could reshape the region’s balance of power after a decade of deepened economic and security cooperation.

Rising Tensions and Strategic Mistrust

Israeli media recently reported that Israeli Defense Minister Yisrael Katz held high-level discussions accusing Egypt of breaching the peace treaty by expanding its military infrastructure in Sinai.

Although the presence of more Egyptian troops in Sinai can technically be reversed, what truly alarms Israeli security circles is the scale and permanence of Egypt’s military build-up. This includes:

• • Over $50 billion in arms deals

• • Construction of 8 new ports and massive military storage zones

• • Infrastructure enabling the rapid deployment of troops into Sinai

• • Expansion of strategic fuel reserves from 40 million to over 180 million liters

While Tel Aviv acknowledges Cairo’s commitment to peace, it also fears that a regime change in Egypt could trigger a shift in foreign policy.

Gaza War: Exposing Diverging Interests

The Israeli war on Gaza has frozen the warming relations between Egypt and Israel. Israel seeks to expel a large portion of Gaza’s population near its borders. Egypt, on the other hand, fears that accepting masses of displaced Palestinians will not only destabilise Sinai but also spark public backlash against what would be perceived as complicity in Israel’s ethnic cleansing.

Cairo’s severe economic crisis, however, limits its ability to push back. Analysts suggest that if Trump throws full support behind the deportation plan, and if Saudi Arabia endorses it, Egypt might reluctantly comply in exchange for economic incentives, while requesting minor adjustments to preserve internal stability.

No Return to “Warm Peace”

The post-October 7 landscape signals that trust has eroded. While both nations are expected to manage their disputes quietly, the era of openly flourishing relations has likely ended.

Egypt’s relationship with Israel has always been U.S.-driven, and this dynamic will continue to shape the limits of Cairo’s sovereignty in foreign policy.

Background: From Cold Peace to Sisi–Netanyahu Alliance

In May 2024, Israel’s redeployment of tanks and heavy armour along the Philadelphi Corridor near Gaza was seen by Egyptian officials as a strategic threat, violating Camp David’s provisions. The peace treaty had allowed only lightly armed Egyptian police in the border zone.

Despite starting as a “cold peace”, relations began to thaw:

• • In 2004, the QIZ agreement enabled joint industrial exports with Israel and the U.S.

• • In 2005, Egypt signed a 20-year gas export deal with Israel.

• • After the 2011 revolution, tensions rose briefly, but the 2013 military coup in Egypt, viewed positively by Tel Aviv, marked a turning point.

With the ISIS insurgency in Sinai, Israel supported Egypt militarily and allowed modifications to Camp David’s annex. By 2021, Israel allowed Egypt to deploy three times the permitted number of troops in Sinai.

By 2020, Egypt began importing Israeli gas under a $19.5 billion strategic deal, later partnering with Israel and the EU in 2022 to export liquefied natural gas to Europe. This partnership in energy and intelligence made Egypt vulnerable to Israeli leverage—Tel Aviv is now threatening a 40% hike in gas prices amid renewed tensions.