Ahmed Kamel – Egypt Daily News
Egypt’s fuel import bill is expected to surge sharply as global energy markets react to the escalating conflict involving Iran, placing additional strain on the country’s finances.
According to a government official familiar with the matter, Egypt’s fuel import costs could rise to nearly $1.2 billion in April, marking an increase of about 56 percent compared with roughly $767 million before the outbreak of hostilities. The spike is driven by significant increases in global oil prices following the conflict involving the United States and Israel.
The rising costs highlight the vulnerability of Egypt, which relies heavily on imported petroleum products to meet domestic demand. The country imports around one million tons of fuel products each month to bridge the gap between supply and consumption. These imports typically include approximately 600,000 tons of diesel, 230,000 tons of gasoline, and 170,000 tons of liquefied petroleum gas.
President Abdel Fattah el-Sisi has previously stated that Egypt’s annual consumption of petroleum products amounts to nearly one trillion Egyptian pounds, equivalent to about $20 billion. Around 60 percent of this consumption is used to power electricity generation.
However, a significant pricing gap continues to weigh on public finances. The Ministry of Electricity pays only about 100 billion Egyptian pounds for fuel used in power generation, while the actual cost is estimated at around 600 billion pounds. This leaves a shortfall of approximately 500 billion pounds, which is absorbed by the petroleum sector due to subsidized energy pricing.
In an effort to mitigate rising import costs, the government has taken steps to boost domestic refining capacity. Refinery operating rates were increased by about 10 percent in March, reaching roughly 650,000 barrels per day, up from 590,000 barrels per day in February. The move is intended to help meet local demand and reduce reliance on imports amid ongoing market volatility.
Analysts warn that continued instability in global energy markets could further increase pressure on Egypt’s budget, particularly if oil prices remain elevated or supply disruptions persist in key production and transit regions.
