Egypt’s LNG Costs Double Amid War and Output Decline

Egypt’s costs for imported liquefied natural gas (LNG) have more than doubled, driven by the war with Iran and a steady decline in domestic gas production. Officials said the price of a single LNG cargo rose as much as 100% since September, reaching over $100 million.

To manage rising expenses, Cairo has asked suppliers to push five of its 15 November LNG cargoes into 2027, adding to about 15 cargoes already deferred since July. The Petroleum Ministry had budgeted $10.1 billion for LNG imports in the fiscal year starting July 1 and had spent $5.8 billion by October 6.

To reduce the bill, Egypt’s state-owned Electric Utility Company (EGPC) purchased six cargoes of high-sulfur fuel oil for delivery in November and December. Fuel oil imports have increased since April, exceeding 640,000 tons in October.

Egypt’s gas output has declined steadily since late 2021, averaging 4.87 bcf/d in 2024, the lowest in eight years, and about 4 bcf/d in the second half of 2025. In July, Egypt imported more gas than it produced for the first time on record, with imports easing slightly to 3.44 bcf/d in August.

Imports still account for nearly half of Egypt’s gas consumption, with 2.24 bcf/d of LNG and 1.20 bcf/d via pipeline from Israel. Existing fields are losing about 120 mmcfd of output each month, according to the Asharq Bloomberg report. New wells and Shell’s Mina West field may hold production flat in early 2027 before the decline resumes.

The Petroleum Ministry has extended the deadline for bids on 14 exploration blocks to December 14 after companies requested more time. QatarEnergy has kept its LNG deliveries under force majeure since April, extending the period to the end of December.