Iran War Doubles Egypt’s LNG Bill as Gas Output Keeps Falling

Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com.

The war on Iran has doubled what Egypt pays for imported LNG, and Cairo is deferring cargoes into 2027 and burning fuel oil in its power plants to hold down the bill. Egypt’s own output fell to 3.63 bcf/d in August as older fields declined faster than new wells came online, and the petroleum ministry has now extended the deadline for bids on 14 exploration blocks meant to reverse that decline to December 14 after companies asked for more time. QatarEnergy has kept its LNG deliveries under force majeure since April, and on October 28 it extended that to the end of December. A government official told Asharq Bloomberg that the price of a single LNG cargo has risen as much as 100% since September, to more than $100 million.

Cairo has asked suppliers to push five of its 15 November LNG cargoes into 2027, on top of about 15 cargoes it had already deferred since July. The Petroleum Ministry budgeted $10.1 billion for LNG imports in the fiscal year that began July 1 and had spent $5.8 billion of it by October 6. Egypt has set aside about $1 billion for November cargoes. To cut the bill, EGPC bought six cargoes of high-sulfur fuel oil for delivery in November and December. Egypt’s fuel oil imports have trended higher since April and exceeded 640,000 tons in October.

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