Egypt’s petroleum sector has returned to growth for the first time in nearly two years after the government settled $6.1 billion in outstanding payments to international oil companies (IOCs), triggering $19 billion in fresh investment commitments from four major energy firms.
The sector recorded 0.7% growth in the third quarter (Q3) of fiscal year (FY) 2025/2026 — its first positive reading since Q1 of FY2023/2024 — according to Ahmed Rostom, Egypt’s Minister of Planning and Economic Development, who presented the figures during a Cabinet weekly meeting.
Rostom attributed the improvement to higher domestic production of crude oil, condensates, and liquefied petroleum gas (LPG).
Crude output has now surpassed 540,000 barrels per day (bbl/d), Karim Badawi, Minister of Petroleum and Mineral Resources, announced during a 17 June meeting with senior officials of the Egyptian General Petroleum Corporation (EGPC), the state entity that oversees upstream oil and gas activity in the country.
The turnaround follows the completion of an accelerated repayment programme that eliminated arrears owed to IOCs. Those arrears had reached approximately $6.1 billion in June 2024 and were fully cleared by June 2026. Unpaid dues to foreign energy partners had long been cited as a drag on exploration and development activity in Egypt, discouraging capital deployment and slowing new project approvals.
With the debt resolved, Egypt has secured more than $19 billion in investment pledges over the next three years. Italy’s Eni leads the commitments at $8 billion, followed by BP with $5 billion, US-based Apache Corporation with $4 billion, and UAE-headquartered Arcius Energy with $2 billion.
The scale of the commitments reflects renewed confidence in Egypt as a hydrocarbon destination. The country sits at the intersection of Mediterranean and Red Sea energy corridors and hosts significant natural gas infrastructure, including liquefied natural gas (LNG) export terminals that serve European buyers. A sustained recovery in crude production and a cleared payment record strengthen Egypt’s position as a hub for regional energy investment.
For investors tracking North Africa’s upstream sector, the Egypt rebound carries broader implications. Several governments in the region have faced similar IOC payment disputes, and Egypt’s resolution — and the investment response it generated — offers a template for how clearing legacy arrears can rapidly restore operator confidence and accelerate capital inflows.
The petroleum sector’s return to growth also supports Egypt’s wider economic recovery at a time when the country has been navigating foreign currency pressures and a demanding International Monetary Fund (IMF) programme. Energy exports remain a critical source of hard currency, and higher production volumes, combined with fresh upstream investment, are expected to reinforce that position in the years ahead.
