Egypt could potentially lease crude storage on the Red Sea to AD Ports

Egypt is working to expand its crude storage leasing on the Red Sea with a pitch to AD Ports, Asharq Business reports, citing a government official. Talks are underway to rent out warehouses for crude oil and refined products, with both sides aiming to close before the end of 2Q.

What’s on the (negotiating) table: Negotiations are pinning down how many storage units, where they sit, and how they’re priced — monthly or annual leases are on the table, Asharq said.

Why this matters: Stranded barrels are rewriting the map — in Egypt’s favor. With flows disrupted through Hormuz, the system is short on routes and long on stranded barrels — with onshore stocks rising by 20 mn barrels in the region — shifting value from transit to storage. Egypt stepping in with available capacity captures the upside where the market is clearing right now.

It leans into the “hub” thesis: Egypt has around 29 mn barrels of spare storage across its main ports, a figure that puts it squarely in play for traders and storage looking for optionality and strategic location. The country counts 19 commercial ports, 14 under development, and nearly 79 petroleum storage facilities built or upgraded in recent years, according to Asharq.

Inventory is already on the market: Egypt offered 10 crude and petroleum storage facilities for lease in the Red Sea, aiming to attract oil deliveries from Saudi Arabia, Kuwait, Iraq, and Qatar, while doubling storage capacity at its Sumed- and Ras Badran-associated facilities, a senior government official previously told us.

REMEMBER- The Red Sea is getting a second chance after Aramco diverted shipments to Yanbu on Saudi Arabia’s west coast via its East-West pipeline — with the Sumed pipeline being offered to the Kingdom to facilitate the transfer of Saudi crude oil from Yanbu to the Mediterranean.

What’s the latest on Hormuz anyway? So far, brisk movement has continued to trickle through the Strait of Hormuz, despite the US blockade — which pushed crude briefly past USD 100 / bbl and put regional producers on high alert after Tehran threatened to retaliate against wider maritime infrastructure.