Egypt says Saudis have cut off fuel shipments indefinitely

2016-11-08 08:44
File: AFP

File: AFP

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Cairo - Egypt said on Monday that Saudi Arabia has halted fuel shipments indefinitely, in a sign of lingering tensions following a dispute over the conflict in Syria.

The move ratchets up pressure on Egypt as it implements austerity measures in the hope of securing billions of dollars in loans to stabilize its ailing economy. Cairo floated its currency last week and cut fuel subsidies, leading to across-the-board price hikes in the Arab world's most populous country.

Egyptian Oil Ministry spokesman Hamdi Abdel-Aziz said that Saudi Arabia's Aramco, the world's largest oil company, stopped sending the fuel shipments to Egypt "without giving a specific timetable or reasons".

Saudi Arabia agreed in April to provide Egypt with 700 000 tons of fuel monthly for five years on easy repayment terms, but Egypt said last month that October's shipments had been halted. The Saudi government has not spoken about the matter, and Aramco did not immediately respond to a request for comment.

Political solution 

The move appears to have been taken in response to Egypt's support of a UN Security Council resolution on Syria that was fiercely opposed by Riyadh. Saudi Arabia is a leading supporter of the rebels fighting to topple President Bashar Assad. Egypt, fearing the rise of Islamic militants, has pushed for a political solution that might keep him in power.

Saudi Arabia provided billions of dollars in aid to Egypt after the military-led overthrow of Islamist President Mohammed Morsi in 2013. But that support appears to have dried up, forcing Cairo to court other patrons.

Egypt reached an agreement with the International Monetary Fund earlier this year for $12bn in loans, but must implement austerity measures for it to be ratified. After the fuel shipments were halted, Egypt signed a memorandum of understanding to import oil from Iraq, which is closely allied with Iran, Saudi Arabia's main regional rival.

Abdel-Aziz denied reports that Egypt's oil minister would soon travel to Iran. The Iranian Foreign Ministry also denied the reports.

Read more on:    egypt  |  north africa

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