Saudi Aramco sends two cargoes of diesel fuel to Egypt

Saudi Aramco sent two cargoes of diesel fuel to Egypt on March 17 and 18, after the oil giant agreed to resume shipments to the North African country last week, Reuters reported, citing Egyptian petroleum minister Tarek El-Molla.

El-Molla expects Egypt's petroleum imports to drop to 5-7 percent from 35 percent by 2020.

Saudi Aramco signed a $23 billion deal in April last year with state-owned Egyptian General Petroleum Corporation (EGPC) to supply the country with 700,000 tons of oil products monthly over a five-year period.

However, relations soured between two of the Arab World’s largest economies later in 2016, after Egypt voted in favor of a UN resolution in October, which was backed by Russia but opposed by Saudi Arabia.

A few days after the voting, Aramco halted oil supplies to Egypt for six months straight, but did not terminate the agreement. The suspension forced the nation to resort to new tenders in order to purchase fuel needed for local consumption.

In January this year, an Egyptian court rejected a government appeal to transfer two Red Sea islands to Saudi Arabia, a verdict that deepened tensions between the two countries.

However, El-Molla said last week that Aramco would resume shipments of oil products to Egypt, adding that the ministry was working with the Saudi oil giant on a timetable to resume shipments.

The Saudi oil producer’s suspension of shipments was for purely commercial reasons, the minister said.