Egypt’s rising oil import bill could cancel out any gains from higher gas export revenues this year, Oil Minister Tarek El Molla told CNBC Arabia yesterday (watch, runtime: 11:49). “It’s possible that the extra [income] we get from our gas exports could be canceled out by the increase in the price of oil and its products,” the minister said on the sidelines of an energy conference.

Egypt enjoyed an oil trade surplus last year: Egypt reported a USD 2.1 bn oil trade surplus last year, according to balance of payments figures. The central bank is yet to release figures for 1Q 2022, which coincided with a spike in oil and gas prices on the back of the war in Ukraine. Egypt is a net importer of oil but exports gas.

There’s no knowing where prices are going: El Molla said he hoped to “maintain '' gas export revenues this year compared with 2021, but added that gas and oil prices remain volatile, making the outlook difficult to predict. The value of Egypt’s petroleum exports rose 84% in 2021 on the back of a five-fold increase in our LNG and natural gas exports. “We’re positive in general about conditions,” El Molla said.

Natural gas prices have spiraled to new record highs in Europe in response to the Russia-Ukraine war, potentially providing an opportunity for Egypt to offset some of the pain caused by the oil price spike. El Molla previously signaled that Egypt could capitalize on the current market conditions and raise LNG exports.

Investments in the energy sector could reach USD 7-8bn this fiscal year, the minister told Al Arabiya (watch, runtime: 3:22) at the conference. Rising oil prices globally could push the figure even higher following review, he added. Investments by foreign oil firms fell 26% to USD 5.4 bn in FY 2020-2021.