Who won? No party won an outright majority – that has never happened in an Israeli election – but the result was a triumph for Binyamin Netanyahu. His right-wing Likud party won 30 seats in the 120-member Knesset – six more than the second-placed Zionist Union, a centre-left alliance of Isaac Herzog's Labor Party and former justice minister Tzipi Livni's Hatnuah. Netanyahu has the numbers to assemble a right-wing coalition with the help of a centrist grouping led by an ex-Likudnik. He is set for a fourth term as prime minister and is on course to overtake David Ben-Gurion as Israel's longest-serving head of government.
Was this expected? Netanyahu was the favourite, but in the closing stages of the campaign the momentum had swung towards the Zionist Union, whose emphasis on socioeconomic issues chimed with the dominant themes of the election: the soaring cost of living and the lack of affordable housing.
Herzog – son of the Irish-born Chaim Herzog, Israel's sixth president – had a good campaign, while Netanyahu was dogged by controversy over his spending habits and his mixed domestic record. Eve-of-election opinion polls gave the Zionist Union a four-seat lead, which could well have been enough to make Herzog prime minister.
As Israelis went to sleep on voting day, exit polls were showing a 27-27 tie. But by the following morning, with the votes counted, the Likud party had pulled comfortably ahead.
What swung it for Netanyahu? In the closing days of the campaign Netanyahu veered sharply to the right. He repudiated the principle of a two-state solution to the Israeli-Palestinian conflict (which he had previously endorsed) and pledged to keep building settlements on occupied land. On election day he warned that Arab-Israelis were flocking to polling stations "in droves" to bolster the left.
Bibi’s late surge came at the expense of two rival parties on his right flank: Jewish Home, led by his former protege Naftali Bennett, and Avigdor Lieberman’s Yisrael Beiteinu. As a result they will come to the coalition negotiations with less bargaining power, further strengthening Netanyahu.
Was it all bad news for the left? The Zionist Union's result of 24 seats is a big increase on the 15 the Labor Party won in the 2013 election and cements its position as the leader of the left alternative to the Likud. Herzog's critics say he lacks charisma and military credentials, but his consensual, affable approach has helped him appeal to centrists and unite a party long riven by factionalism.
Another significant development was the performance of the Joint List, an alliance of Arab-Israeli parties, which won 13 seats and becomes the third-largest grouping in the Knesset. It increased turnout among Israel’s Arabs, who make up a fifth of the population, and will have greater influence in the coming years.
What does the outcome mean for the peace process? The peace process was moribund even before the election, and Israel was growing increasingly isolated. Many foreign governments had quietly hoped a new administration would at least create a more propitious atmosphere for a resumption of talks on a deal with the Palestinians.
Optimists will point out that there is no guarantee a left-led government would have been in a position to negotiate a settlement. After all, it was a right-wing prime minister, the Likud founder Menachem Begin, who signed the historic peace treaty with Egypt in 1979. Left-wing prime ministers have been enthusiastic settlement-builders. Herzog would still have had to deal with the internal Fatah-Hamas divisions on the Palestinian side, while facing the wrath of the Israeli right. And if Netanyahu has really changed his mind on a Palestinian state, then he can change it again.
But there’s no doubt that, in the short term at least, hopes of peace have been dealt a setback. “It is clear Israel has voted for burying the peace process, against the two-state choice and for the continuation of occupation and settlement,” said Saeb Erekat, the chief Palestinian negotiator in talks with Israel.
The Palestinians have indicated they will press ahead with unilateral steps towards independence, including filing charges against Israel at the International Criminal Court over its 48-year occupation of the West Bank and East Jerusalem, as well as deaths stemming from last year's war in Gaza.
