Aging grids buckle across North Africa as region’s energy map shifts around Hormuz

A brutal summer is converging with a paralyzed global oil market recast the region’s energy map: Across North Africa, aging grids are buckling under 40°C-plus heat, creating pressure and unrest among some and opening up an export path for others. Meanwhile, Iraqi oil is finding its way to the Mediterranean by routing around Hormuz through Syria. Yemen is preparing to turn on its export taps again, while Lebanon wants its old pipeline back in the game.

Parts of energy-rich North Africa have been plunged into the dark, with outages sweeping Libya, Algeria, and Tunisia as demand spikes and decades-old infrastructure gives way. Although it’s not exactly helping, this isn’t a problem that can be blamed on the US-Iran war — the three countries are struggling with decrepit power plants and fuel shortfalls that have made it impossible to keep up with energy demand amid ongoing heat waves.

Each of the three countries had a similar sequence of events: In OPEC member Libya, a failed transmission line in the west cascaded into a nationwide blackout, knocking out roughly 1,350 MW and cutting power and water to most of the country. Algeria — one of Africa’s largest gas exporters and a key supplier to Italy, Spain, and France — suffered its worst outage in two decades earlier this month, dragging down neighboring Tunisia, where the national gas and electricity company has since imposed scheduled cuts of up to seven hours a day and told people to ease off the air conditioning.

Libya's collapse became Egypt’s opening: Cairo resumed exporting power to Libya at an initial 70 MW after the grid collapse — but only after Tripoli paid down some USD 100 mn of arrears owed since 2023, with a schedule to clear the remaining USD 41 mn of a USD 141 mn tab before end-2026. Egypt has spent roughly EGP 965 bn over the past decade building out generation, lifting installed capacity to about 60 GW against summer peak load near 40 GW, as it looks to establish itself as a regional interconnection hub.

On the oil side of the picture, a bigger structural shift is underway: The US began importing Iraqi-origin fuel oil shipped via Syria’s Baniyas Port on the Mediterranean for the first time. The route, live since early May, sees Iraqi fuel oil trucked across the border by some 900 tanker-trucks a day and loaded at Baniyas roughly every seven to 10 days. Cargoes have already reached Spain and Egypt, and now they’re reaching US shores. Crucially, Iraqi and Syrian officials say Baghdad intends to keep using the Syrian corridor even after Hormuz normalizes.

Everyone wants a piece of the new map. Lebanon has formally asked Iraq’s oil minister to schedule a Baghdad visit to revive the long-dormant Kirkuk-Tripoli pipeline — a play to get back onto Iraq’s export menu just as Baghdad and Damascus signed an American-brokered MoU to rehabilitate the Kirkuk-Baniyas line, with initial throughput touted at up to 2 mn bbl / d. In Yemen, Oil Minister Mohammed Bamouqa says the government is preparing to resume crude exports and lift output by 25% in the first month of restarted operations.

MEANWHILE- Egypt is looking to secure its LNG needs with talks to import 15-18 cargoes per month for at least three years. The Egyptian government is in talks with Shell, TotalEnergies, BP, and Hartree Partners, Reuters reports, citing three unnamed sources. The transactions could cost Egypt between USD 8-11 bn per year, with prices set at roughly USD 1.5 above the European gas price benchmark, according to calculations by the newswire.