Egypt nearing deal with Iraq in search for crude oil imports

EGPCEgypt is nearing a deal to import crude oil from Iraq and is looking to other countries to help secure supply, Egyptian General Petroleum Corporation’s chief Tarek al-Hadidi said.

Cairo’s search for additional crude comes after Saudi Arabia’s state oil firm Saudi Aramco halted shipments of oil products to Egypt last year.

The $23 billion Saudi aid deal had included 700,000 t of refined oil products per month for five years. Aramco has never provided a reason for why the deal was halted.

Egypt has turned to the spot market in recent months to make up for the missing products.

The EGPC last month announced it was seeking up to 1.012 MMt of gasoil for delivery in February and March compared to around 200,000 t of gasoil per month before the Aramco cutoff.

Egypt has turned to Iraq in search of a longer term solution to make up for the shortfall, and is in talks to import 1 MM barrels per month of crude oil from Baghdad, which would then be refined into petroleum products in Egypt.

An Egyptian delegation is set to visit Iraq this month to work out final details.

“We are now in the final stages with the Iraqi government and ministry of oil in Iraq to supply 1 million barrels per month, this will be a good way to secure our crude supplies,” EGPC’s Hadidi said at the Egypt Petroleum Show (EGYPS) in Cairo on Tuesday.

Hadidi said Egypt would look for similar deals with other countries as a way of securing its crude supplies.

“We are trying to have an agreement with other countries as well as government to government deals,” he said.

(Source: Reuters)

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