Egypt plans to resume importing Basra crude oil from Iraq starting in the third quarter of the year, after a suspension lasting approximately 18 months, according to several media reports. A government official said the plan involves importing 12 million barrels annually, marking a revival of a deal that had previously been paused due to financial disputes between the two countries.

Several media reports indicate that Iraq halted the crude oil supply to Egypt at the end of 2023, citing disagreements related to financial arrangements, particularly concerning the issuance of letters of credit. The two nations are now reportedly close to resolving these issues, potentially allowing oil shipments to resume later this year.

In April 2017, the Egyptian General Petroleum Corporation, or EGPC, signed an agreement with Iraq’s State Organization for Marketing of Oil, known as SOMO, to supply 12 million barrels of Basra Light crude annually. The agreement structured shipments at a rate of two million barrels each, offering Egypt favorable payment terms. Under this arrangement, EGPC would pay for the oil three months after its delivery — a condition that has remained a key point in ongoing discussions.

Egypt's renewed interest in securing Iraqi crude oil reflects its broader strategy of diversifying energy sources while negotiating credit-based purchasing terms. These terms allow the country to manage its foreign exchange reserves more effectively amid broader economic challenges.

Currently, Egypt imports oil under similar credit arrangements from other regional suppliers. Each month, Egypt purchases one million barrels of crude oil from Kuwait and another one million barrels from Saudi Arabia’s Aramco, further indicating the government's preference for deferred payment structures.

Media reports suggest that the potential resumption of oil imports from Iraq would not only strengthen bilateral energy cooperation but also offer Cairo a more balanced portfolio of crude suppliers. The development is seen as a strategic move to ensure energy security while navigating fluctuating oil prices and geopolitical uncertainties.

As negotiations between Egypt and Iraq approach a conclusion, observers expect a formal announcement once the remaining financial and logistical details are finalized. The deal, if reinstated, would mark a significant step in reestablishing the oil trade relationship that has historically benefited both nations.