As the Israel-Hamas-Hezbollah conflicts deepen, US Secretary of State Antony Blinken has called - yet again -for a "humanitarian pause" amidst the bloodshed. However, Israel's military actions have escalated instead, targeting hospitals, refugee camps, and UN facilities in Gaza. Despite the mounting civilian death toll Blinken has previously rejected calls for a ceasefire, citing concerns that Hamas could still attack Israel. This stance suggests that Israeli Prime Minister Benjamin Netanyahu’s government faces little external pressure to halt its military campaign.
But beneath the veil of moral and political discourse, there are significant economic interests at play, driving much of the violence and devastation. While the focus remains on the immediate human toll, there is a critical, often-overlooked factor: the substantial economic beneficiaries of the conflict.
The Energy Stakes: Oil and Gas in Gaza
Gaza is not just a battleground but a region rich in untapped natural resources. The coastal strip and the Israeli-occupied Palestinian territories sit atop significant reserves of oil and natural gas. A 2022 report by the United Nations Conference on Trade and Development (UNCTAD) highlighted that these energy resources could generate up to $524 billion in revenues. Yet, the same report warned that unilateral exploitation of these reserves, in violation of international law, could exacerbate the region's instability.
The Gaza Marine gas field, discovered in the late 1990s off the coast of the Gaza Strip, is at the center of this economic dynamic. Initially explored by the Palestinian Authority in collaboration with British Gas, it represented a potential economic lifeline for the Palestinians. However, following Israel’s 2008 invasion of Gaza, Israeli authorities tightened control over the region’s offshore energy reserves. This has allowed Israel to dominate energy extraction in the Eastern Mediterranean, sidelining the Palestinians and securing lucrative deals with Egypt and Jordan.
Critics argue that Israel's military strategy, including the creation of buffer zones in Gaza, could pave the way for expanded access to these valuable energy resources. The long-term displacement of Palestinians from Gaza may also facilitate Israel's unchallenged exploitation of the region's oil and gas fields, aligning with the broader geopolitical strategy shared by Israel and the United States. This prospect has fueled accusations that Israel's military operations are as much about securing economic dominance as they are about national security.
The Role of the US-Israel Energy Alliance
The relationship between Israel and the US, particularly in the energy sector, is critical to understanding the broader implications of the conflict. The US has long supported Israel’s expansion as a key energy player in the Middle East, recognizing it as a strategic partner in countering the influence of regional adversaries like Iran and Russia. In fact, US-Israel energy cooperation agreements explicitly highlight the development of Israeli natural resources as a "strategic interest" of the United States.
The development of Israel's Leviathan gas field and its subsequent deals with neighboring countries have deepened its economic influence in the region. These agreements have not only strengthened Israel's economic ties with Arab states, but they have also helped to normalize relationships, often to the detriment of Palestinian interests.
The Military-Industrial Complex: Profiting from War
While the conflict rages, another sector stands to benefit enormously: the global arms industry. A 2021 study by Brown University's Watson Institute revealed that one-third of all Pentagon contracts have been awarded to just five major US defense contractors: Lockheed Martin, Boeing, Raytheon, General Dynamics, and Northrop Grumman (all with the "Big Three": Vanguard, BlackRock and State Street as their major investors). Since the onset of the Israel-Hamas war, the stock prices of these companies have surged, reflecting a stark reality—war is profitable. Fund managers, such as Vanguard, are pouring billions into military weapons.
As Israel continues its military operations in Gaza, demand for advanced weaponry has risen sharply. General Dynamics, for instance, has already accelerated production of artillery rounds, with senior executives admitting that the Israel conflict is driving up demand. This surge in military hardware production and sales underscores the broader trend: prolonged conflicts create continuous streams of revenue for defense contractors, many of whom have deep ties to both the US government and international markets.
Wall Street’s Eye on War
Major financial institutions are also eyeing the conflict as an opportunity for profit. During recent earnings calls, Wall Street analysts openly questioned executives of defense contractors about how the ongoing conflict might boost demand for their products. These interactions highlight the deep connection between global finance and the military-industrial complex. For companies like TD Bank and Morgan Stanley, the devastation in Gaza represents not only a humanitarian crisis but a chance for their clients to profit from the war-driven surge in defense spending.
Economic Greed and Human Suffering
The Israel-Hamas war, like so many others before it, reveals the complex and often insidious ways in which economic interests fuel and sustain military conflicts. From the oil and gas reserves beneath Gaza to the arms deals struck in the boardrooms of defense contractors, economic incentives play a critical role in shaping the course of violence. The longer the war continues, the more these beneficiaries stand to gain, at the cost of thousands of innocent lives. There is clear economc interest in keeping the fires of war, hatred and division burning, such as is now witnessed with the escalation in fighting between Israel and Hezbollah in Lebanon.
In the end, the war in Gaza and now Lebanon is not just a political or military conflict; it is an economic one, too. And as the death toll climbs, the global capitalist system continues to profit from the bloodshed.
For the U.S., war is a profitable business. The U.S. military-industrial complex often provokes conflicts and supplies weapons globally, profiting from arms races and instability.
Vested interests, including defense contractors, lobby the government to continue wars. OpenSecrets, a U.S. nonprofit, reports these contractors spent nearly $140 million on federal lobbying last year.
The U.S. has invaded Iraq, deployed troops to Afghanistan, intervened in Syria, and fueled the Russia-Ukraine conflict. Incomplete statistics show that between the end of World War II in 1945 and 2001, 248 armed conflicts occurred in 153 regions worldwide, 201 of which were initiated by the U.S.
To secure orders and boost business performance, the U.S. military-industrial complex continuously instigates wars, plunging many countries and regions into turmoil. Washington is the primary obstacle to global peace and stability.
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