Egypt Says Saudi Fuel Shipment Freeze Is Unrelated to UN Spat

  • Tensions over Syria sparked fears IMF loan would be delayed
  • El-Sisi says oil product shipments are commercial matter

Egyptian President Abdel-Fattah El-Sisi said Saudi Aramco’s decision to halt oil product shipments to Egypt wasn’t a retaliation for his government’s position on the war in Syria.

The shipments are determined by commercial agreements and "we do not know companies’ circumstances," El-Sisi was quoted as saying by the state-run Ahram Gate news website on Thursday. "We will take the appropriate position,” he said, without giving further details.

Egypt’s support for a Russian-drafted UN Security Council resolution on Syria over the weekend earned a rare public rebuke from Saudi Arabia, which has provided Egypt with billions of dollars in aid since the 2013 ouster of Islamist President Mohamed Mursi. The dispute triggered investor fears that Saudi Arabia would withhold or cancel a $2 billion payment Egypt needed to secure a crucial International Monetary Fund loan -- until officials familiar with the matter said the payment had already been made.

Egypt’s oil ministry has said it secured oil products to offset the October freeze on shipments from Saudi Arabia, and that despite the halt, the overall multi-billion dollar, five-year deal between the two countries was unaffected.

With Egyptian authorities already struggling to pass a maritime border pact with its long-time backer, the dispute over Syria came at a difficult time for El-Sisi and his government. Officials hope the $12 billion IMF loan will help restore investor confidence and end a foreign-currency shortage that’s crippled the economy, and are expected to devalue the pound and cut energy subsidies to secure the lender’s approval.

Egypt also needed to find as much as $6 billion from bilateral creditors before the IMF board would consider the loan. Egypt has told the lender it secured the full amount, and expects its board to consider the loan request within two weeks, the Cairo-based Shorouk newspaper reported on Thursday, citing Deputy Finance Minister Ayman El-Kaffas.

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