Egypt Halts LNG Imports Amid Cooler Weather, Relieving Pressure on European Market

Egypt has unexpectedly halted several liquefied natural gas (LNG) imports this month, reversing a trend of massive purchases earlier this year, Bloomberg reports.

The decision, attributed to lower electricity demand due to cooler weather, has freed up LNG cargoes for the European market, where demand remains strong amid colder temperatures.

A source familiar with the matter, speaking on condition of anonymity due to the sensitivity of the information, explained that Egypt’s reduced need for LNG has led to the rescheduling of deliveries from the current quarter to the next. This comes as a significant relief to the nation’s strained finances, which have been impacted by a decline in Suez Canal revenue following recent Houthi attacks in the Red Sea.

The sudden shift contrasts sharply with Egypt’s substantial LNG imports earlier this year, driven by soaring summer temperatures and a decline in domestic gas production. September’s gas production figures, released by the Joint Organizations Data Initiatives, showed a 19% year-on-year drop to 3.8 billion cubic meters.

While rumors circulated among traders regarding potential technical issues at the Hoegh Galleon floating LNG terminal in Ain Sokhna, or the Energos Eskimo terminal in Aqaba, Jordan (used for additional Egyptian imports), the source confirmed that no such problems exist. Despite this, two LNG vessels are currently awaiting unloading near Ain Sokhna.

The reduced demand from Egypt has created a ripple effect, potentially easing pressure on European LNG prices and availability. The diverted cargoes were destined for both Egyptian and Jordanian terminals, with some shipments already in close proximity before being rescheduled.

While Egypt has continued to purchase fuel into the cooler months, it has not exported any LNG since April.