Egypt’s gas exports under threat

It is hard to imagine that Egypt, currently the world’s 12th largest exporter of liquefied natural gas (LNG), is suffering an acute domestic fuel shortage. But power blackouts have been the norm this summer. The government announced several measures to ease the crisis, including outages and mandatory work-from-home days for civil servants. 

While recurring summer heat waves and a higher demand for cooling are to blame for the crunch, the crisis reflects a deeper problem – a limitation in Egypt’s gas production capacity. It raises questions about the country’s export potential and has implications for buyers in Europe and elsewhere. 

Unless new significant discoveries are made in Egypt, its domestic gas consumption is reduced and local prices align with those in the international market, the country’s standing as a major gas exporter will be compromised, along with its ambition to become a regional gas hub.