So much has happened in recent weeks that it’s easy to get swept up in war headlines and overlook quieter, yet significant, commercial developments inside Israel. Amid the escalating exchange of blows between Iran and Israel, a strategically important energy deal was quietly finalized.
SOCAR, Azerbaijan’s state oil company – which announced in February 2025 its acquisition of a 10% stake in Israel’s Tamar gas field – has now received full approval from Israel’s Petroleum Council and Competition Authority, officially marking its entry into Israel’s natural gas market.
SOCAR’s arrival stands to benefit all parties involved. The Tamar field is a pillar of Israel’s energy infrastructure and the main artery supplying natural gas to the domestic market. Since coming online in 2013, it has provided approximately 60%-70% of Israel’s annual electricity production.
Yet Israel has struggled to attract new oil and gas companies to participate in its energy sector. That reluctance has fostered an overreliance on a handful of players and raised concerns about the monopolization of its strategic energy assets. The inclusion of SOCAR adds much-needed diversity to the Tamar consortium and injects greater resilience into the sector – especially in light of recent shutdowns during the war.
SOCAR now joins an impressive roster of stakeholders that includes US energy major and field operator Chevron (25%), Abu Dhabi’s state-owned Mubadala (11%), and several Israeli firms – an impressive blend of regional and international players. Orchestrated by Israeli businessman and Union Energy owner Aaron Frenkel, the transaction preserves Tamar’s existing ownership structure while reinforcing its investment structure.
For SOCAR, the investment is a strategic move into the Eastern Mediterranean upstream market, a region where it hopes to continue growing. In October 2023, just weeks after the outbreak of war, SOCAR partnered with BP and Israel’s NewMed Energy to bid on two additional offshore blocks. The Israeli Energy Ministry granted those licenses in March 2025.
Already a key supplier of gas to Europe, SOCAR’s expanding footprint in Israel could eventually open new routes and strategies for future export diversification in the region.
Israel-Azerbaijan strategic ties
But this deal goes beyond commercial interests. It signals that the Israel-Azerbaijan strategic partnership is both deepening and evolving. Long rooted in mutual security concerns – from arms cooperation to countering shared regional rivals – ties between Jerusalem and Baku have grown increasingly meaningful.
Azerbaijan remains one of Israel’s primary oil suppliers, transporting crude via the Baku-Tbilisi-Ceyhan pipeline. During the 2020 Nagorno-Karabakh war, Israeli arms played a critical role in supporting Azerbaijan’s military efforts against Armenia. And while Baku has denied any role in facilitating Israeli operations during the recent war between Israel and Iran, the two countries are widely believed to coordinate closely in countering Iranian influence across the region.
Azerbaijan has also stepped up diplomatically, hosting a series of high-level meetings between Israeli and Turkish defense officials in May 2025 in an effort to ease tensions over the use of Syrian airspace. In doing so, Baku has positioned itself as a regional intermediary – one capable of bridging gaps between competing interests.
The message is unmistakable: Azerbaijan, a secular state with a Shi’ite-majority population, is reinforcing its strategic partnership with Israel at a time when many regional actors are distancing themselves or expressing unease with Israeli policy. While others question Israel’s military posture and its alignment with broader regional visions of connectivity and economic cooperation, Baku is doubling down.
This move also sends a signal to Washington and Europe: Azerbaijan sees itself as a capable player in regional affairs – ready to expand its role in energy security, diplomacy, and integration efforts like the Abraham Accords. In this sense, the Tamar field deal is more than a financial transaction; it’s a marker of a maturing alliance.
As the Middle East grapples with volatility and shifting alliances, SOCAR’s investment in the Tamar field stands out. It underscores how, even in times of conflict, energy diplomacy continues to shape the foundations of regional cooperation.
For both Israel and Azerbaijan, this deal is about far more than natural gas – it reflects a shared vision of long-term alignment and the foresight to cultivate durable partnerships in an increasingly unstable environment.
It also offers a diplomatic blueprint Israel would do well to replicate: quiet, pragmatic engagement that yields tangible outcomes, rather than performative declarations that fade as quickly as they are made.
The writer is a senior policy fellow at the Mitvim Institute, a visiting fellow at the German Marshall Fund, and director of undergraduate studies at Notre Dame Jerusalem.