MediumVI Energy Politics & Supply Security8 November 2026, Sunday
Egypt cuts gas to fertiliser makers again as LNG budget tightens
Egyptian fertiliser producers were notified on 8 November of a fresh 33% cut in natural gas supply, following an earlier 20% reduction. The government is trying to rein in costly LNG imports: of roughly 10.1 billion dollars set aside for 2026/27, 5.8 billion had been spent by 6 October.
According to The New Arab, Misr Fertilizers Production Company confirmed it had been told of the new cut. After the previous reduction, MOPCO and Abu Qir said they would manage output around the gas available; Abu Qir said it had a contingency plan built on inventories and its maintenance schedule. The Petroleum Ministry did not immediately respond to a request for comment. One analyst said LNG prices are running above the ministry's assumptions and spending is on course to overshoot the budget.
Cargo costs are behind the cut. EnterpriseAM, citing Asharq Business, reports that Egypt has requested about 10 LNG cargoes for November, against 12 in October, and pushed 5 of 15 contracted cargoes into 2027. A single cargo now costs more than 100 million dollars, twice the September level, putting November imports at roughly 1 billion dollars. The same report says the Idku plant plans to ship its first export cargo to Europe in months before the end of the month.
In Talay's reading, Egypt's constraint is not a lack of gas but how many cargoes its foreign-currency budget can carry. The government is choosing to protect electricity demand by cutting supply to industry, and fertiliser exports and industrial output are paying for that choice. The Energos Winter floating terminal at Damietta was hit by a drone strike in late July, taking 450 million cubic feet a day of capacity offline; no return date has been confirmed.
Talay assessment
Bottom line
Ahead of winter, Egypt is sharing its LNG bill with industry through supply cuts; with each cargo costing more than 100 million dollars, the budget ceiling now dictates supply decisions. The most likely path is continued industrial curtailment and more cargo deferrals as winter electricity demand climbs.
Likely effects
- Fertiliser industryNegativeWeeks
Two cuts in gas supply, of 20% and 33%, will reduce output and exports; companies will try to bridge the gap with inventories and maintenance scheduling.
- Egypt's external balanceNegative1–6 months
Of a roughly 10.1 billion dollar LNG budget, 5.8 billion was spent by early October; an overshoot enlarges the country's foreign-currency needs.
- European gas supplyUncertainWeeks
If Idku exports start at the end of the month, a small but symbolic extra cargo heads to Europe; it could be deferred if domestic demand rises.
Possibilities, ranked
- 1Cuts persist through winter60%
Gas restrictions on industry continue, and cargo deferrals follow for December too.
Watch: The Petroleum Ministry's December cargo requests and exchange filings by fertiliser companies
- 2Prices ease and supply normalises25%
An arrangement in the Strait of Hormuz lowers LNG prices, and the cuts are lifted gradually.
Watch: The status of QatarEnergy's force majeure decision after the end of December
- 3Power cuts return15%
Industrial curtailment proves insufficient, and the government reinstates scheduled power cuts for households.
Watch: Load-shedding announcements from Egypt's electricity company
Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.
Market reaction
Indicators affected
- Gas cut to fertiliser▼ 33%
- LNG cargo cost▼ >$100mn
- November LNG cargoes▼ ~10