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Egypt: Two Deals to Explore for Petroleum, Gas

Tarek El Molla, Egypt's Minister of Petroleum and Mineral Resources. REUTERS/Amr Abdallah Dalsh
Tarek El Molla, Egypt's Minister of Petroleum and Mineral Resources. REUTERS/Amr Abdallah Dalsh
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Egypt: Two Deals to Explore for Petroleum, Gas

Tarek El Molla, Egypt's Minister of Petroleum and Mineral Resources. REUTERS/Amr Abdallah Dalsh
Tarek El Molla, Egypt's Minister of Petroleum and Mineral Resources. REUTERS/Amr Abdallah Dalsh

Egypt's Minister of Petroleum and Mineral Resources Tarek El-Molla signed on Saturday two deals with international firms to explore for petroleum and gas in two deep-water areas in the Mediterranean and the Western Desert.

In a statement, the ministry said the deals were signed with companies from Canada, Britain, the Netherlands, Malaysia, and Kuwait, adding that the deals include drilling 12 wells at an investment of at least 1 billion US dollars.

The minister affirmed that the petroleum sector will proceed with offering international bids, as well as signing new agreements with the aim of boosting Egypt's production of petroleum and gas to reduce imports. However, Egypt aims to return to an energy exporter after resources were discovered across the country, which attracted international firms over the past few years.

Egypt is currently engaged in deals with international energy corporations for oil and gas exploration, including Italy's Eni and Britain's BP.

In another context, Cairo is hosting meetings of the World Franchise Council, represented by the Egyptian Franchise Development Association (EFDA).

Tarek Tawfik, the chairman of the EFDA, said on Saturday in a statement that such important event represents a great opportunity for the franchise grantors to present their trademarks and expand their activities by the participation in the exhibition in the presence of 46 entities representing thousands of franchise projects around the world.

Under the theme "Social franchise and sustainable development", the fair will offer a group of franchise opportunities on the local and international levels and encourage investors to get a franchise through boosting investments and signing trade deals, Tawfiq added.

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IMF: Middle East Conflict Escalation Could Have Significant Economic Consequences

Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki
Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki
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IMF: Middle East Conflict Escalation Could Have Significant Economic Consequences

Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki
Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki

The International Monetary Fund said on Thursday that an escalation of the conflict in the Middle East could have significant economic ramifications for the region and the global economy, but commodity prices remain below the highs of the past year.

IMF spokesperson Julie Kozack told a regular news briefing that the Fund is closely monitoring the situation in southern Lebanon with "grave concern" and offered condolences for the loss of life.

"The potential for further escalation of the conflict heightens risks and uncertainty and could have significant economic ramifications for the region and beyond," Kozack said.

According to Reuters, she said it was too early to predict specific impacts on the global economy, but noted that economies in the region have already suffered greatly, especially in Gaza, where the civilian population "faces dire socioeconomic conditions, a humanitarian crisis and insufficient aid deliveries.

The IMF estimates that Gaza's GDP declined 86% in the first half of 2024, Kozack said, while the West Bank's first-half GDP likely declined 25%, with prospects of a further deterioration.

Israel's GDP contracted by about 20% in the fourth quarter of 2023 after the conflict began, and the country has seen only a partial recovery in the first half of 2024, she added.
The IMF will update its economic projections for all countries and the global economy later in October when the global lender and World Bank hold their fall meetings in Washington.
"In Lebanon, the recent intensification of the conflict is exacerbating the country's already fragile macroeconomic and social situation," Kozack said, referring to Israel's airstrikes on Hezbollah in Lebanon.
"The conflict has inflicted a heavy human toll on the country, and it has damaged physical infrastructure."
The main channels for the conflict to impact the global economy have been through higher commodity prices, including oil and grains, as well as increased shipping costs, as vessels avoid potential missile attacks by Yemen's Houthis on vessels in the Red Sea, Kozack said. But commodity prices are currently lower than their peaks in the past year.
"I just emphasize once again that we're closely monitoring the situation, and this is a situation of great concern and very high uncertainty," she added.
Lebanon in 2022 reached a staff-level agreement with the IMF on a potential loan program, but there has been insufficient progress on required reforms, Kozack said.
"We are prepared to engage with Lebanon on a possible financing program when the situation is appropriate to do so, but it would necessitate that the actions can be taken and decisive policy measures can be taken," Kozack added. "We are currently supporting Lebanon through capacity development assistance and other areas where possible."