Egypt said it expected crude oil imports to start arriving next month after Libya and Iraq agreed to make shipments to help Cairo weather an economic crisis.
More than two years of political turmoil since an uprising toppled President Hosni Mubarak have hammered Egypt’s economy. Foreign currency reserves, used to pay for food and fuel under subsidy programs that make up about a quarter of the budget, have fallen to critically low levels.
Egypt’s oil ministry said in a statement on Tuesday measures would be implemented to rein in an energy crisis, including “the arrival of the Libyan and then Iraqi crude oil shipments next month”.
Some areas have experienced sporadic power outages, and fuel shortages have also led to queues at many filling stations over the past few months.
The economic crisis has pushed Egypt to seek easy payment terms from suppliers by cutting diplomatic deals that leverage the country’s strategic importance.
Iraq said during a visit by Egypt’s Prime Minister Hisham Kandil to Baghdad in March that it had agreed to supply Egypt with 4 million barrels of oil per month.
Last month, Libya said it would supply Egypt with $1.2 billion worth of crude oil at world prices but on interest-free credit for a year.
The Islamist-led government of President Mohamed Morsi is trying to negotiate a $4.8 billion loan from the International Monetary Fund. Economists expect reforms of the country’s fuel subsidy programs to be included in any deal.
Reuters
