Egypt Increases Refining Capacity by 10% to Meet Demand and Reduce Import Bill

SadaNews - Egypt has raised the operational capacity of its refineries by about 10% in March to reach 650,000 barrels per day compared to 590,000 barrels per day in February, aiming to meet local market needs and reduce the bill for importing petroleum products, which have seen global price increases amid escalating wars in the Middle East, according to government officials who spoke to "Asharq" on condition of anonymity.

Maintenance Postponed to Increase Production

One official stated that the government has postponed scheduled maintenance work for some of the refineries during this period to maximize operational capacity until the crisis is overcome, which may last for weeks in light of the absence of clear indicators for calming tensions.

Egypt primarily relies on local refineries with a total capacity of about 34 million tons annually, which include 8 main refineries, among them the Mostorod Complex, which houses the "Egyptian Refining Company" along with the "Midor" refinery in Alexandria, and other refineries in Suez, Nasr, and Cairo.

Reducing the Import Bill After Market Disruptions

The increase in refining aims to cover local market needs and reduce dependence on imported refined petroleum products, especially diesel and gasoline.

The Iran War has caused significant disruptions in global energy markets, with oil prices rising to levels exceeding $120 per barrel before later retracting those gains.

Egypt consumes about 12 million tons of diesel and nearly 6.7 million tons of gasoline annually, making any increase in local production a significant factor in reducing import costs.

The refining increase coincides with the commissioning of new fields and expansions in existing ones, most of which are in the Gulf of Suez, alongside increased investments from foreign partners.

Mohamed Youssef, former vice president of the Egyptian Petroleum Authority, stated that the government has no choice but to increase refining rates to alleviate the impact of the substantial rise in global fuel prices.

He explained in his remarks to "Asharq" that diesel prices - the most imported product in Egypt - have risen by about 100% in the global market to reach approximately $1,323 per ton, compared to about $685 before the outbreak of the war.

He added that the sharp rise in prices is due to the shutdown of several refineries in East Asia and the Middle East due to the war's repercussions.