Tourism in Egypt, Lebanon, Jordan Could Incur $16.1B amid Hamas-Israel War

People sitting at a restaurant along the Corniche Al Manara in the Lebanese capital Beirut on November 5, 2023 (AFP)
People sitting at a restaurant along the Corniche Al Manara in the Lebanese capital Beirut on November 5, 2023 (AFP)
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Tourism in Egypt, Lebanon, Jordan Could Incur $16.1B amid Hamas-Israel War

People sitting at a restaurant along the Corniche Al Manara in the Lebanese capital Beirut on November 5, 2023 (AFP)
People sitting at a restaurant along the Corniche Al Manara in the Lebanese capital Beirut on November 5, 2023 (AFP)

After a month has passed since the war between Israel and Hamas, neighboring countries are facing significant economic challenges, especially Lebanon, Jordan, and Egypt.

The war has struck at their economic foundations, and its negative effects have directly and indirectly impacted all sectors, posing severe threats to economic growth, foreign reserves, domestic output, inflation, increased unemployment, and decreased investment.
Israel, of course, will not escape unscathed. It is likely that its economy will suffer serious consequences, with its real GDP expected to decline by 5 percent annually in the last quarter of 2023.

According to the latest reports from S&P Global Ratings, published on Tuesday, it is anticipated that the most significant damage from the war between Israel and Hamas will be felt outside the conflict zones, particularly in the tourism sector in Egypt, Lebanon, and Jordan.

The agency stated in a report released on Monday that these losses could range from 10% to 70% of total tourism revenues recorded last year, depending on the escalation of the conflict, the expansion of its scope, and its duration.

S&P Global Ratings presented three scenarios, with the most severe one estimating total losses in tourism revenues for the three countries at $16.1 billion.

It stated that the countries directly neighboring Israel and Gaza are particularly vulnerable to a slowdown in tourism, contributing to 12%-26% of their current account revenues, generating foreign currency income, and creating job opportunities.

Tourism revenues have increased by over 50% in Jordan and 30% in Egypt during the first half of 2023.

In Lebanon, the number of tourists has risen by 33% from January to August.

The tourism sector also provides employment opportunities for approximately 20% of the population in these countries, which is crucial given the high unemployment rates witnessed in the three nations.

 

 



Could Egypt’s ‘SUMED’ Pipeline Temporarily Replace the Strait of Hormuz?

Egypt’s Petroleum Minister Karim Badawi during an inspection tour of SUMED port (Egyptian Petroleum Ministry)
Egypt’s Petroleum Minister Karim Badawi during an inspection tour of SUMED port (Egyptian Petroleum Ministry)
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Could Egypt’s ‘SUMED’ Pipeline Temporarily Replace the Strait of Hormuz?

Egypt’s Petroleum Minister Karim Badawi during an inspection tour of SUMED port (Egyptian Petroleum Ministry)
Egypt’s Petroleum Minister Karim Badawi during an inspection tour of SUMED port (Egyptian Petroleum Ministry)

Amid the ongoing Iran war and Tehran’s announcement of the closure of the Strait of Hormuz, a key artery for global energy supplies, Egypt has begun highlighting the SUMED pipeline linking the Red Sea and the Mediterranean as a potential temporary alternative for oil transport.

The move has raised questions about whether the pipeline, a vital connection between the two seas, could help offset disruptions to the volatile waterway.

Egypt’s Minister of Petroleum and Mineral Resources Karim Badawi addressed the issue during a government press conference on Tuesday, saying Egypt “has sufficient technical and logistical capabilities to support this strategic route.”

He said the SUMED pipeline enhances the flexibility of oil supply flows in the region and confirmed Egypt’s readiness to cooperate with Gulf states to facilitate oil transport from the Red Sea to the Mediterranean through the line.

Energy experts who spoke to Asharq Al-Awsat agreed that the pipeline could help ease the current energy crisis amid the absence of any political solution to end the war, noting the line was originally designed as an alternative route when oil shipments face obstacles passing through the Suez Canal.

SUMED pipeline

The pipeline is owned by the Arab Petroleum Pipelines Company (SUMED), an Arab joint venture led by Egypt, with a 50% stake held by the Egyptian General Petroleum Corporation, alongside partners from Gulf states.

The pipeline runs across Egypt from Ain Sokhna on the Gulf of Suez to Sidi Kerir on the Mediterranean coast, with a capacity of about 2.8 million barrels per day.

According to Egypt’s petroleum ministry, the pipeline transported about 24.9 billion barrels of crude oil and more than 730 million barrels of petroleum products from its launch in 1974 through 2024.

Ahmed Kandil, head of Energy Studies Program at the Al-Ahram Center for Political and Strategic Studies, said the line’s importance lies in easing disruptions to oil trade following Tehran’s declaration that it had closed the Strait of Hormuz.

He told Asharq Al-Awsat that oil shipments could reach the pipeline via tankers transporting crude from Saudi Arabia’s Yanbu port to Egypt’s Ain Sokhna port, from where it would move through the pipeline to the Mediterranean and onward to Europe.

He said coordination with Gulf states is underway to contain concerns over energy supplies, particularly among European consumers.

Kandil added that the arrival of part of Gulf exports to European markets is highly important, helping limit spikes in Brent crude prices, which have already surpassed $80 per barrel.

“The growing importance of the Egyptian pipeline comes amid the absence of a political horizon, which means the current conflict could be prolonged,” he said.

Storage capacity

According to the US Energy Information Administration, the main reason for building the SUMED pipeline at this location is that very large crude carriers — capable of transporting about 2.2 million barrels — cannot pass through the Suez Canal due to their excessive weight and width, which could risk grounding.

Instead, they offload their cargo at Ain Sokhna, where the oil is transported through the pipeline to the other side of Egypt. Smaller vessels then reload the crude at Sidi Kerir and sail to Europe and the United States.

Energy markets expert Ramadan Abu Al-Ala said the Egyptian pipeline serves as an alternative to the Suez Canal and could temporarily ease the crisis caused by the closure of the Strait of Hormuz.

He noted that the pipeline is particularly effective for oil tankers arriving from Saudi Arabia, Oman, Bahrain and the United Arab Emirates, which can unload at Ain Sokhna before the crude is transported to the Mediterranean and European markets.

Abu Al-Ala expects SUMED to become even more important for Gulf oil exports to Europe if the war drags on, increasing reliance on the pipeline. However, he said this would require enhanced security measures for oil tankers operating in the Red Sea.

Energy market experts also highlighted another advantage: the pipeline’s large storage capacity. SUMED operates storage tanks with a total capacity of 40 million barrels of oil.

In February 2019, Saudi Aramco signed two agreements with the company to provide storage capacity for diesel and fuel oil.


Saudi East-West Pipeline Underpins Kingdom’s Energy Security Strategy

The King Fahd Industrial Port in Yanbu. (SPA)
The King Fahd Industrial Port in Yanbu. (SPA)
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Saudi East-West Pipeline Underpins Kingdom’s Energy Security Strategy

The King Fahd Industrial Port in Yanbu. (SPA)
The King Fahd Industrial Port in Yanbu. (SPA)

As regional military tensions escalate and attacks on shipping in the Strait of Hormuz recur, Saudi Arabia’s East-West oil pipeline has re-emerged as a critical safeguard in the global energy system.

With markets closely watching threats to the vital maritime corridor, the Kingdom’s sovereign infrastructure is acting as a strategic shield to keep oil flowing. The moment underscores that Saudi Arabia’s logistical resilience and delivery capacity are as vital as its production strength, reinforcing its reputation as the most reliable supplier in times of turmoil.

In a statement to Asharq Al-Awsat, Saudi Aramco said it had adjusted crude oil shipping operations to prioritize safety and service continuity, and to help ensure reliability, by temporarily redirecting allocated volumes to the Yanbu port as an option for customers unable to access the Arabian Gulf.

“We remain fully committed to supporting and serving our customers and continue to assess the situation in order to resume normal procedures,” the company said.

Reuters earlier cited sources as saying Aramco was seeking to reroute some crude exports to the Red Sea to avoid the Strait of Hormuz, after the risk of attacks brought shipping traffic to a near halt.

The company has also informed some buyers of its Arab Light crude that cargoes would need to be loaded at Yanbu.

Sovereign infrastructure

The pipeline, known as Petroline, is more than a transport project. It is sovereign infrastructure built to protect Saudi crude flows from potential maritime disruptions.

The East-West pipeline carries crude from fields in Saudi Arabia’s Eastern Province to the Red Sea coast, where it is exported through King Fahd Industrial Port in Yanbu. Stretching about 1,200 kilometers across the Kingdom, it runs through several pumping stations capable of moving millions of barrels per day efficiently.

The line began operating in the early 1980s during a period of heightened regional security concerns, when fears were growing over threats to shipping in the Strait of Hormuz, a route that carries about one-fifth of global seaborne oil trade.

The project had three clear aims: to provide an export outlet outside the Arabian Gulf, to strengthen Saudi energy security, and to reassure global markets about the continuity of supply.

Today, the pipeline has a capacity of about five million barrels per day, far above its initial capacity at launch. That scale gives Saudi Arabia significant logistical flexibility to redirect exports quickly in response to geopolitical or operational disruptions.

Operated by Saudi Aramco, the line is managed through advanced monitoring systems that efficiently regulate crude flows, alongside strict technical and security safeguards.

Why it matters now

Financial and economic adviser Dr. Hussein Al-Attas told Asharq Al-Awsat the pipeline linking the Eastern Region to Yanbu is among the most important strategic infrastructure projects in Saudi Arabia’s energy sector.

Its capacity of roughly five million barrels per day provides the kingdom with high logistical flexibility if disruptions occur in the Arabian Gulf or the Strait of Hormuz, he said.

Amid geopolitical tensions, having an export outlet far from maritime chokepoints reduces operational risks and strengthens the Kingdom’s ability to honor long-term supply contracts.

It is impossible to speak of zero disruptions in absolute terms, but the pipeline significantly reduces risks and makes the likelihood of widespread disruption to Saudi exports very low compared with many other producers, Al-Attas said.

He added that Petroline has evolved from a logistics project into a tool of economic national security.

What was once an oil transport project designed to improve export efficiency has become part of the Kingdom’s economic national security architecture, he said.

Aramco now treats it not only as an alternative route but as a strategic option that diversifies export outlets, reduces reliance on sensitive maritime passages, protects oil export revenues and strengthens reliability for customers in Asia and Europe.

Al-Attas stressed that delivery capability is as important as production capacity, noting that the pipeline’s strategic value lies in ensuring supply even under the most difficult conditions.

During wars or regional tensions, markets rapidly price in risk, he said. The presence of an effective alternative route gives Saudi Arabia a competitive edge by helping ease the risk premium on its crude compared with producers reliant on a single export route.

It also reinforces investor confidence in the stability of Aramco’s cash flows and strengthens the Kingdom’s image as a long-term reliable supplier—an important factor in futures markets.

The more Saudi Arabia proves it can maintain supplies even in the toughest circumstances, the more global markets will see it not only as the largest oil exporter but also as the most reliable and stable, Al-Attas said.

He stressed that the East-West pipeline is no longer just crude transport infrastructure. It is now a strategic pillar that protects revenues, supports financial stability and strengthens Saudi Arabia’s geopolitical weight in the global energy security equation.


Hungary Presses Russia Not to Hike Energy Prices amid Iran Turmoil

3D-printed oil barrels, an oil pump jack and a map showing the Strait of Hormuz and Iran appear in this illustration taken March 2, 2026. REUTERS/Dado Ruvic/Illustration/File Photo
3D-printed oil barrels, an oil pump jack and a map showing the Strait of Hormuz and Iran appear in this illustration taken March 2, 2026. REUTERS/Dado Ruvic/Illustration/File Photo
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Hungary Presses Russia Not to Hike Energy Prices amid Iran Turmoil

3D-printed oil barrels, an oil pump jack and a map showing the Strait of Hormuz and Iran appear in this illustration taken March 2, 2026. REUTERS/Dado Ruvic/Illustration/File Photo
3D-printed oil barrels, an oil pump jack and a map showing the Strait of Hormuz and Iran appear in this illustration taken March 2, 2026. REUTERS/Dado Ruvic/Illustration/File Photo

Hungary wants guarantees from Russia that it will not charge Budapest more for oil and gas, despite global prices jumping due to conflict in the Middle East, Hungary's foreign minister said Wednesday.

Hungarian Foreign Minister Peter Szijjarto was in Moscow to meet Russian President Vladimir Putin in the Kremlin later Wednesday to press the request, according to AFP.

Energy prices have surged since the United States and Israel attacked Iran on Saturday, including the benchmark price of Russian crude.

Hungary is the European Union's biggest importer of Russian fossil fuels, having maintained purchases and secured exemptions from sanctions despite pressure from Brussels amid the Russian offensive on Ukraine.

Budapest was already facing disruption from the closure of the Druzhba pipeline, which transports Russian oil to Hungary and which Ukraine says was damaged in a Russian strike.

Szijjarto said he would be seeking assurances that "the crude oil and natural gas necessary for Hungary's energy supply will continue to be available to us.

"I am also here to obtain guarantees that, despite the changed circumstances and the global energy crisis, Russia will continue to deliver the necessary quantities of oil and gas for Hungary at unchanged prices," he added.

Budapest relies on Russian oil and is currently in a standoff with Kyiv over a halt to supplies via the Soviet-era Druzhba pipeline, which runs through Ukraine.

Ukraine says Russia attacked the pipeline in January and that the threat of another strike was holding up repairs.

Hungary and Slovakia -- which also buys Russian crude -- accuse Kyiv of delaying the repairs in an attempt to put pressure on them and choke them of Russian energy.

Kremlin spokesman Dmitry Peskov said buyers of Russian oil were "facing blackmail" and accused Kyiv of "the deliberate blocking of deliveries through the Druzhba pipeline".