Egypt is confronting a new wave of natural gas shortages as the country enters its hottest summer season. With temperatures expected to rise above 40°C, electricity demand is surging, mostly due to heavy air conditioning use. This surge is putting intense pressure on Egypt’s national power grid. The government in Cairo is rushing to introduce emergency measures to avoid blackouts.
Despite its goal to become a regional energy hub and a major LNG exporter to Europe and beyond, Egypt is struggling to meet its own energy needs at home. This situation highlights the difficulty Egypt faces in balancing energy exports with domestic supply security.
Challenges in Production and Investment
The energy shortage is worsened by slow economic growth, ongoing financial instability, and limited foreign investment. Egypt is missing its natural gas production targets, especially at the massive Zohr offshore gas field, which is facing technical problems. Other gas fields have also not produced the expected output.
Seeking Long-Term LNG Imports
To ease the natural gas shortage, the government is accelerating plans to secure long-term LNG import deals. Reports indicate that Egypt is in advanced talks with Qatar for a long-term LNG supply agreement. This was a key point during a meeting between Egypt’s Petroleum Minister Karim Badawi and Qatar’s Energy Minister Saad bin Sherida Al-Kaabi. According to state-linked newspaper Al-Ahram, Egypt wants to finalize the deal quickly.
As part of the negotiations, Egypt is offering Qatar investment chances in its oil and gas sectors. QatarEnergy’s current concessions in Egypt, including offshore Mediterranean blocks like Nefertari, Masry, and Cairo (in partnership with ExxonMobil), may be expanded.
In another sign of stronger ties, QatarEnergy agreed to buy a stake in Egypt’s North El Dabaa offshore block, working alongside EGAS and U.S. energy company Chevron.
Regional Gas Supply Disruptions
Egypt’s energy situation has also been affected by delays in gas imports from Israel. Under a new agreement, Israel was supposed to deliver 200 million cubic feet per day starting mid-May. But reports from the Egyptian General Petroleum Corporation (EGPC) say Israel is asking for better terms and higher prices.
This delay is unexpected because Israel recently completed a 46-kilometer expansion of the offshore gas pipeline connecting Ashdod and Ashkelon to Egypt’s network at Arish. This upgrade was meant to increase gas imports from Israel from 1.0 to 1.2 billion cubic feet daily, supporting Egypt’s LNG export terminals at Idku and Rosetta.
Emergency LNG and Fuel Oil Measures
Meanwhile, Egypt is working to secure 14 LNG shipments this month from European and U.S. suppliers on deferred payment terms. The urgency has grown as Italy’s Eni has failed to deliver an additional 250 million cubic feet per day from the Zohr field, now delayed until August 2025.
Though Egypt is a major oil and gas producer, the domestic supply shortfall has forced the country to seek around $7 billion to buy 155–160 LNG cargoes in 2025. The government hopes to limit LNG purchase prices to $14 per million British thermal units (MMBtu), despite global prices easing.
Return to Fuel Oil for Power
In a controversial step, Egypt is returning to using cheaper fuel oil for power generation, reversing a previous shift toward cleaner energy. Environmental groups are expected to criticize this move. Recently, EGPC issued a tender for 2 million tons of fuel oil for delivery in May and June. With natural gas becoming more costly and straining Egypt’s finances, fuel oil is seen as a more affordable short-term option.Egypt’s energy crisis highlights the country’s struggle to balance export ambitions with urgent domestic needs, especially during peak summer demand.
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