Sunday, March 19, 2017

Aramco shipments officially resume - ENTERPRISE

Sunday, 19 March 2017

Saudi Aramco has resume shipments of petroleum products to Egypt, which received shipments on both Friday and Saturday, Oil Minister Tarek El Molla told CBC’s Lamees El Hadidi last night. The next two shipments are scheduled to arrive on 25 and 26 March and will then return to a regular schedule from next month. Egypt is set to buy c. USD 320-340 mn each month at today’s prices. El Molla had told Reuters’ Arabic service on Thursday that the shipments were expected to resume by the end of March or in early April. The resumption of shipments — part of a USD 23 bn, five-year supply agreement halted last year amid rising tensions between Cairo and Riyadh — was announced last Wednesday.
Commitments to other fuel import agreements putting financial strain on the EGPC: The agreement to import 1 mn barrels of crude oil per month from Iraq is still on and was not a replacement for Saudi oil, El Molla added. Sources from the Oil Ministry said the Iraq contract will go into effect by mid-April at the latest, according to Iraq Tradelink News Agency. The Oil Ministry had confirmed last week that Egypt remains committed to oil import agreements signed during the spat with Saudi, prompting a cash squeeze at the Egyptian General Petroleum Company (EGPC), according to its CEO Tarek Al-Hadidi. The EGPC issued international tenders and sought deals “with more than 50 international suppliers” after Aramco suspended shipments in October, he told Ahram Weekly. The international tenders required the EGPC to pay for shipments within one month of delivery, whereas the Aramco agreement allows Egypt to pay for the shipments in instalments over 15 years.

In another sign of warming ties between Cairo and Riyadh, the Saudi-Egyptian businesscouncil is preparing to hold an investment conference in Cairo this May, with 200 Saudi businessmen expected to attend, the council’s vice president Abdallah bin Mahfouz tells Al Borsa. According to Mahfouz, none of the agreements signed between the Saudi and Egyptian governments during King Salman’s visit to Cairo last year have been suspended. Bin Mahfouz says the Kingdom’s private sector has continued to invest in Egypt despite “economic hardships” at home.

Has Trump been playing marriage counselor? Analysts speaking to the Financial Times say Donald Trump had focused Egyptian and Saudi minds on a rapprochement. “Because of the Trump factor and the new Saudi strategy to counter Iran, we are back into a ‘forgive and forget policy,’” said Abdullah Alshammri, a former Saudi diplomat. “Riyadh’s policy towards Egypt can be described as emergency diplomacy — it is time to work only against Iran, and we need Cairo.” Ziad Akl, an analyst at Cairo’s Al-Ahram Center for Political and Strategic Studies, said neither country could afford a prolonged rift.

Saudi is also kicking up the rhetoric about the Muslim Brotherhood being the root of all evil, playing music to Egypt’s ears. A long statement released by a senior advisor to Saudi Crown Prince Mohamed bin Salman after the latter’s meeting with Trump notes: “Osama Bin Laden … was among Muslim Brotherhood since he was a college student, and Al-Zawahiri himself was a member of the Muslim Brotherhood as well.”