Israel has rejected Egypt’s plan to reconsider the price of gas and has threatened to resort to international arbitration, an official source in the Petroleum sector told Ahram Online.

The source said that the American partner in the East Mediterranean Gas Company (EMG), which is owned by fugitive businessman Hussein Salem, has already warned the Egyptian Natural Gas Holding Company (EGAS) that Israel will seek international arbitration if Egypt does not resume pumping gas to Israel based on the prices agreed upon in exisiting contracts.

The source said that Egyptian officials have rejected Israel’s threats and are adamant that they will adjust the prices and only resume pumping gas after agreement is reached.

The source added that Spain, however, has accepted the amendments to the gas prices.

The issue of gas prices has been a massive point of tension during the Mubarak regime. Many believed that Mubarak and his cronies sold Egypt’s gas to Israel and other countries at prices well below its value. Adjusting the gas prices has became a key demand of the revolutionaries which led interim Prime Minister Essam Sharaf to promise to review the existing agreements.