Egypt’s government has introduced a new increase in natural gas prices for energy-intensive industrial sectors, effective Friday, May 1, as part of efforts to restructure energy pricing mechanisms for the industrial sector.

 

According to a decision published in the Official Gazette, natural gas prices for factories have been set based on the type of industrial activity, with a minimum price of $6.5 per million British thermal units (mmBtu).

 

Under the new pricing scheme, gas prices for the cement sector have been raised to $14 per mmBtu, up from $12 previously. Prices for steel, non-nitrogen fertilizers, and petrochemicals have increased to $7.75 per mmBtu, compared with $5.75 before the decision.

 

Meanwhile, gas prices for all other industrial activities have been set at $6.75 per mmBtu.

 

The decision noted that these prices do not apply to consumers whose gas pricing is determined by contractual formulas, with such customers continuing to be billed according to the agreed pricing mechanisms in their supply contracts.

 

It also stated that the relevant authorities at the Ministry of Petroleum and Mineral Resources will determine gas prices used in petrochemical production, particularly for ethane and propane feedstock, based on the mechanism outlined in the decision.

 

The move comes amid a sharp rise in Egypt’s natural gas import bill following the outbreak of the U.S.-Israeli conflict with Iran in late February. In March, Prime Minister Mostafa Madbouly said the country’s monthly gas import bill had surged to around $1.65 billion, up from $560 million prior to the conflict, driven by a spike in global prices.