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Egypt: Saudi oil shipments halted indefinitely

Egyptian Oil Minister Tarek al-Molla also said that he was not going to Iran to strike new oil deals

Published: Updated:

Saudi Arabia has informed Egypt that shipments of oil products expected under a $23 billion aid deal would be halted indefinitely, suggesting a deepening rift between the Arab world’s richest country and its most populous.

Saudi Arabia agreed to provide Egypt with 700,000 tonnes of refined oil products per month for five years in April, during a visit by King Salman.

The cargoes stopped arriving at the start of October, as festering political tensions burst into the open, but Egyptian officials said the contract remained valid and had appeared to hold out hope that oil would start flowing again soon.

Saudi Arabia’s state oil firm Aramco has not commented on the halt. But on Monday, Egyptian Oil Minister Tarek al-Molla confirmed it had halted the shipments indefinitely.

An oil ministry official told Reuters: “They did not give us a reason. They only informed the authority about halting shipments of petroleum products until further notice.”

The move comes as a source in Molla’s delegation said late on Sunday evening that he would visit Iran, Saudi Arabia’s main political rival, to try to strike new oil deals.

Molla not visiting Iran

Molla, who attended on Monday an oil conference in Abu Dhabi, told Reuters he was not going to Iran, appearing to contradict the report.

“No Iran visit. I am attending the conference,” he told Reuters.

Egypt and Iran’s diplomatic relations have been strained since the 1970s. An Egyptian official visiting Iran would cement a break in its alliance with Saudi Arabia and mark a seismic shift in the regional political order.