Mediterranean and European alliances

In Egypt, Turkey has found a strong regional ally. Egypt's transitional government reopened its border with Gaza in May this year drastically undermining the blockade imposed by Israel since 2006. This puts at stake the stability of Israel's borders, already weakened because of the Arab unrest.

The recent attack on the Israeli embassy in Cairo was yet another stark reminder of the challenges the Jewish state faces in the region.

"The Turkish government is creating for itself a regional leadership role by capitalizing on public sentiment on Palestine at the expense of relations with Israel," said Kadri Kaan Renda, research fellow at the Centre for Strategic Research and Analysis in Istanbul.

However, what makes the ongoing tension particularly alarming is that political skirmishes between Israel and Turkey have turned into a tug-of-war in the eastern Mediterranean.

In order to counter the influence of Cairo and Ankara, Israel is turning to Greece and Cyprus, negotiating new deals to export energy and gas to Europe.

Turkey responded by issuing the following statement. "Israel has proclaimed its right to operate in exclusive economics zone in the eastern Mediterranean. You will see that Israel will not have this exclusive right because Turkey as the guarantor of the Northern Republic of Cyprus has already taken measures in the sector," Erdogan said last week.

Experts do not believe that this new Tel Aviv-Nicosia-Athens alliance will be a major player given the debt crises and public protests its governments face.

While the West is expected to align itself with Israel as it has done in the past, the diplomatic crisis has put the U.S. in an uncomfortable situation. The U.S. relies on Turkey to help stabilize a post-war Iraq and act as a bridge to Iran.

Furthermore, the Obama administration has of late slapped Israel on the wrists when it was seen to be crossing the line, more so than the previous Bush regime ever did. This new U.S. outspokenness against Israel is something Turkey has taken full advantage of, feel analysts.

Meanwhile, Europe continues to offer moral and practical support to the Middle East. EU foreign policy chief Catherine Ashton is said to be in regular contact with Turkish Foreign Minister Ahmet Davutoglu, having recently paid a visit to the region to pledge the bloc's support to the reconstruction and nation-building efforts there.

But few think the EU will directly mediate between Turkey and Israel. "I doubt the EU will make any statement because that's an extremely sensitive topic. Europe has not even been involved in the investigations into the Maramara Flotilla incident," said Amanda Paul, researcher at the European Policy Centre in Brussels.