The Egyptian General Petroleum Corporation (EGPC) urged Saudi Aramco to provide Egypt with the $300m worth of petroleum shipments.
The shipments are part of the first contract to supply petroleum products worth $1.4bn for a period of three months ending in November.
A senior official at the Ministry of Petroleum and Mineral Resources told Daily News Egypt that the prices of Brent oil have declined in global markets over the past three months, which allows for an excess of facilitations contracted by the EGPC with Aramco.
The source added that the Ministry of International Cooperation negotiated with the Saudi side to renew the supply contract with Aramco with long-term payment facilitations, in addition to the provision of $300m worth of shipments remaining from the first contract.
A high-level Saudi delegation will visit Egypt within the next two weeks to finalise the Saudi-Egyptian Coordination Council talks, and to discuss investment opportunities and aid to support Egypt’s state budget, through grants, petroleum aids, and deposits at the Central Bank of Egypt (CBE).
The official explained that the previous contract with the Saudi company included the provision of 500,000 tonnes of diesel, 220,000 tonnes of fuel oil, and 150,000 tonnes of gasoline a month.
The Ministry of Petroleum and Aramco signed a contract for facilitations of about $1.4bn for the supply of shipments of petroleum products over a period of three months starting last September. The value of the contract is to be paid one year later.
Saudi Arabia is the largest oil exporter in the world, along with the UAE and Kuwait. The three Arab states have provided Egypt with billions of dollars worth of aid after the ouster president Mohamed Morsi in July 2013.
Saudi Arabia had increased its raw production to 10.308m barrels during the second half of this year, so as to enhance its share in the Asian market and nourish local power plants and refineries.
An EGPC report estimated the needs of the domestic market at 500,000 tonnes of diesel, 300,000 tonnes of butane, 150,000 tonnes of gasoline, and 500,000 tonnes of fuel oil per month.
The annual domestic consumption of gasoline stands at 6.1m tonnes, of which gasoline 80 takes up nearly half (2.7m tonnes), followed by gasoline 92 (2.5m tonnes). Gasoline 95 accounts for about 400,000 tonnes, according to figures in the closing account of the FY 2014/2015 budget.