Egypt is actively engaging with energy companies and trading firms to procure between 40 and 60 shipments of liquefied natural gas (LNG) as the nation grapples with a deepening energy crisis ahead of the high-demand summer period, according to three insiders familiar with the talks who spoke to Reuters. At current market rates, Egypt may have to allocate up to $3 billion to secure these supplies, placing further pressure on government budgets already strained by declining domestic gas production and rising living costs.

President Abdel Fattah al-Sisi recently instructed the government to take all necessary proactive measures to guarantee a steady electricity supply, underscoring the urgency of the situation. An industry source close to the discussions told Reuters that the government is negotiating to import at least 40 LNG cargoes alongside roughly one million tons of fuel oil. Gas imports remain the priority due to more flexible payment terms, though fuel oil remains a contingency should LNG prices become prohibitive.

In the past two years, Egypt has faced rolling blackouts as local natural gas production fell well short of demand. February saw Egypt’s gas output reach its lowest point in nine years, forcing the country—once a net exporter—to turn into a major LNG importer last year. This shift led Egypt to abandon previous plans to supply Europe, as a shortage of hard currency has delayed payments to international oil companies, slowing exploration and production efforts.

A second trading source indicated that Egypt could require as many as 60 LNG cargoes to meet its 2025 energy needs, with long-term demand potentially rising to 150 shipments. Negotiations are underway with major suppliers including Qatar, Algeria, Saudi Aramco, and leading global trading houses. Requests for comment from Egypt’s Ministry of Petroleum, Qatar Energy, Saudi Aramco, and Algeria’s Ministry of Energy and Mining went unanswered at the time of reporting.

Adding to Egypt’s energy woes is a reduction in gas supplies from Israel’s Leviathan offshore field due to scheduled maintenance. This disruption has forced several fertilizer plants to halt or scale back production for at least two weeks, jeopardizing fertilizer exports—a vital source of foreign currency. Egypt depends heavily on Israeli gas, which makes up 40-60% of its imported gas supply and 15-20% of total consumption, according to JODI data.

However, Egypt may face rising costs as Israel reportedly seeks a 25% hike in gas export prices. Unlike LNG, which is priced against Asian and European benchmarks, Israeli gas pricing is tied to oil prices that have recently fallen. An Israeli energy ministry spokesperson told Reuters that gas prices are determined through commercial negotiations between companies and that the government does not directly intervene in these discussions. Egypt’s Ministry of Petroleum had yet to respond to inquiries regarding the situation.