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Egypt, Cyprus Sign Gas Export Deals, Boosting Eastern Mediterranean Energy Cooperation

The logo of Italian energy company Eni is seen at a gas station in Rome, Italy August 16, 2018. (Reuters)
The logo of Italian energy company Eni is seen at a gas station in Rome, Italy August 16, 2018. (Reuters)
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Egypt, Cyprus Sign Gas Export Deals, Boosting Eastern Mediterranean Energy Cooperation

The logo of Italian energy company Eni is seen at a gas station in Rome, Italy August 16, 2018. (Reuters)
The logo of Italian energy company Eni is seen at a gas station in Rome, Italy August 16, 2018. (Reuters)

Egypt and Cyprus signed agreements on Monday enabling the export of gas from Cyprus's offshore fields to Egypt for liquefaction and re-export to Europe, as both countries seek to bolster the Eastern Mediterranean's role as an energy hub.

The deals signed at the 2025 Egypt Energy Show formalize a long-anticipated plan to link Cypriot reserves to Egypt’s liquefied natural gas (LNG) facilities, a move that leverages Egypt’s existing infrastructure to process and ship natural gas to European markets.

Monday's agreements involve gas extracted from one Cypriot site, Cronos Block 6 - now under license to a consortium of Italy's Eni and France's Total - to be processed at Egypt's Zohr facilities before being liquefied at Damietta and exported to Europe.

A second memorandum of understanding outlines a framework of processing gas from Cyprus' offshore Aphrodite field, under license to a Chevron-led consortium, which will also be sent to Egypt for processing.

The east Mediterranean has yielded some major gas discoveries in recent years, while a disruption in energy supplies from Russia after its invasion of Ukraine in 2022 has sharpened Europe's attention on securing supplies elsewhere.

"The essence of these agreements is not limited to promoting the exploitation of deposits, but broadens the prospects for energy cooperation with Egypt, while contributing to regional stability and strengthening our country's geopolitical position in the Eastern Mediterranean," a statement from Cyprus's Presidency said.

Cypriot officials have previously said they expect gas from Block 6 Cronos to possibly come online in 2026 or 2027. Cronos gas in place is estimated at more than 3 trillion cubic feet (tcf).

Aphrodite holds an estimated 3.5 tcf of gas. Israel's NewMed, a member of the consortium, expects gas to come online in 2031, it said in a stock exchange filing on Sunday.

In a Monday filing update, it said the "non-binding" MoU envisaged that Egypt's national gas company, EGAS, would be the sole buyer of the gas produced from Aphrodite, while the partners would be granted an option to purchase specific quantities of the gas sold to EGAS as LNG.

The signing of the Aphrodite deal follows a recent breakthrough between Cyprus and the Chevron-led consortium after months of disagreement over a development plan.

The agreement provides a boost for Egypt, which has struggled with declining domestic gas production and last year returned to being a net importer of natural gas.

Egypt recently signed $3 billion worth of LNG supply deals with Shell and TotalEnergies to cover domestic demand for 2025.

Egyptian Prime Minister Mostafa Madbouly has emphasized the country's need to ramp up production at its own Zohr gas field, where operator Eni has resumed drilling after output dropped to 1.9 billion cubic feet per day in early 2024.

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Japan Says No Plan for Big Concessions in Talks on US Tariffs 

Japanese Prime Minister Ishiba Shigeru speaks at a joint press briefing after his meeting with NATO Secretary General Mark Rutte (not pictured) at the Prime Minister's Office in Tokyo, Japan, April 9, 2025. (Reuters)
Japanese Prime Minister Ishiba Shigeru speaks at a joint press briefing after his meeting with NATO Secretary General Mark Rutte (not pictured) at the Prime Minister's Office in Tokyo, Japan, April 9, 2025. (Reuters)
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Japan Says No Plan for Big Concessions in Talks on US Tariffs 

Japanese Prime Minister Ishiba Shigeru speaks at a joint press briefing after his meeting with NATO Secretary General Mark Rutte (not pictured) at the Prime Minister's Office in Tokyo, Japan, April 9, 2025. (Reuters)
Japanese Prime Minister Ishiba Shigeru speaks at a joint press briefing after his meeting with NATO Secretary General Mark Rutte (not pictured) at the Prime Minister's Office in Tokyo, Japan, April 9, 2025. (Reuters)

Japanese Prime Minister Shigeru Ishiba said on Monday his country does not plan to make big concessions and won't rush to reach a deal in upcoming tariff negotiations with US President Donald Trump's administration.

Japan, a long-time US ally, has been hit with 24% levies on its exports to the United States though these tariffs have, like most of Trump's sweeping "reciprocal" tariffs, been paused for 90 days.

But a 10% universal rate remains in place as does a 25% duty for cars, which is set to be particularly painful. The US is Japan's biggest export destination and automobile shipments account for roughly 28% of its exports there.

The two countries will begin trade talks on Thursday in Washington that are expected to cover tariffs, non-tariff barriers and exchange rates.

"I'm not of the view that we should make big concessions for the sake of wrapping up negotiations quickly," Ishiba said in parliament, though he ruled out slapping Japanese tariffs on US imports as a countermeasure.

"In negotiating with the United States, we need to understand what's behind Trump's argument both in terms of the logic and the emotional elements behind his views," Ishiba said, noting that US tariffs have the potential to disrupt the global economic order.

Bank of Japan Governor Kazuo Ueda warned of forthcoming pain.

"US tariffs will likely put downward pressure on the global and Japanese economies through various channels," Ueda told the same parliament session.

In addition to its large trade surplus with the US, Trump has also accused Japan of intentionally maintaining a weak yen - leading to expectations that Tokyo could come under pressure to strengthen its currency - even though a broad dollar sell-off has pushed up the yen of late.

The slow pace at which the Bank of Japan is raising borrowing costs from ultra-low levels could also come under fire in the talks, sources have previously said.

Economy Minister Ryosei Akazawa, who will lead Japan's delegation, said any discussion on currency rates will be held between Japanese Finance Minister Katsunobu Kato and US Treasury Secretary Scott Bessent.

"Both countries share the view that excessive market volatility would have adverse effects on the economy," Kato said.

Any discussion on the yen may spill over to monetary policy and complicate the BOJ's decision on how soon, and by how much, it should raise still-low interest rates.

Akira Otani, a former top central bank economist who is currently managing director at Goldman Sachs Japan, said the BOJ could consider halting interest rate hikes if the yen were to approach 130 to the dollar.

Conversely, a yen slide below 160 could bring forward or accelerate future rate hikes, he said.

The dollar fell 0.62% to 142.62 yen on Monday.

Japan has historically sought to prevent its currency from rising too much, as a strong yen hurts its export-reliant economy. But a weak yen has become the bigger headache in recent years as it has boosted import costs and hurt consumer spending.

Ruling and opposition party lawmakers have escalated calls for the government to cut tax or offer cash payouts to cushion the economic blow from rising living costs and Trump's tariffs.

Ishiba said the government is not thinking of issuing a supplementary budget now, but stood ready to act in a timely fashion to cushion any economic blow.