Egypt to hedge 65% of fuel imports next FY

The government is considering a program to hedge 65% of the country’s fuel imports — including crude, petroleum products, and LNG — in FY 2026/27 to shield the budget from global price shocks, Al Arabiya reports, citing an unnamed government official. This marks a policy whiplash from January, when the Finance Ministry planned to scrap the costly hedge entirely, before the regional war forced a mid-April panic-hedge of 50% that explicitly excluded natural gas.

Why it matters: Driven by ongoing regional volatility, our fuel import bill jumped 14% y-o-y to USD 5.5 bn in 1Q 2026, up from USD 4.8 bn a year earlier. Officials are studying price estimates with international financial institutions to lock in contracts that will ease pressure on the petroleum balance of payments and give the government a clearer picture of its FX needs.

Smaller subsidy bill, bigger hedge: The move comes as Egypt cut budgeted petroleum subsidies for FY 2026/27 by 79% to EGP 15.8 bn. With the domestic market still relying on imported crude to cover more than 25% of its refining needs, expanding the hedge helps keep the state’s bill from blowing up all over again.

Bagging Pharos

Israel’s Ratio Petroleum is buying UK-listed Pharos Energy in a USD 164 mn allcash takeover, according to a disclosure. The transaction hands Ratio a 45% working interest in the El Fayum concession in the Western Desert and the North Beni Suef concession in the Nile Valley. The Israeli acquirer has stated it intends to explore farming out a portion of these Egyptian assets to a third-party partner post-acquisition. The transaction is expected to close in 1H 2027, pending regulatory approvals.

The transaction comes weeks after Pharos received USD 12.6 mn from the government — bringing outstanding receivables to zero — and launched a six-well drilling campaign backed by USD 11 mn in planned investments, according to a statement (pdf).

BACKGROUND- Pharos entered Egypt in 2019 by acquiring El Fayum and the exploration-stage North Beni Suef concession. In 2021, the company sold operatorship and a 55% stake in both assets to US-based IPR Energy, retaining a 45% interest, with IPR remaining the operator of the concessions.

EFG Hermes advises Premium’s 11th issuance

Premium International for Financial Services — often known by its sole product Premium Card — raised EGP 239 mn through its 11th securitized bond issuance. Our friends at EFG Hermes acted as the sole financial adviser and transaction manager, the investment bank said in a press release (pdf). The transaction, which is Premium’s 11th securitization issuance and the first under EFG Hermes’s 14th securitization program, is backed by a receivables portfolio assigned to the firm, which served as the special purpose vehicle for the transaction.

The 36-month bond is split into two fixed-rate tranches: a EGP 66.9 mn tranche with a 12-month tenor, rated P1, and a EGP 172.1 mn tranche running the full 36 months, rated A-.

ADVISORS- EFG Hermes was also the bookrunner, underwriter, and arranger. EG Bank served as underwriter and placement agent, AAIB as custodian, Dreny & Partners as counsel, and KPMG as auditor.