Saudi Arabia will supply 700,000 tonnes of petroleum products per month to Egypt under a $23 billion five-year contract between Saudi Aramco and the Egyptian General Petroleum Corp (EGPC), an official revealed.

Under the deal, Saudi Aramco will supply Egypt with 400,000 tonnes of gas oil, 200,000 tonnes of benzene and 100,000 tonnes of Mazut.

This contract is part of Saudi Arabia's financial support for Egypt which was announced during King Salman’s visit this month.

“The Saudi Fund for Development will pay Aramco for the petroleum products directly, and receive in return the amount from Egypt in instalments,” the official said.

The official added that the funding of the petroleum products will have an interest rate of 2% and is to be paid back over 15 years.

The contract is also part of Saudi Arabia’s change of approach caused by the declining oil price. The change of approach is to concentrate on financial support for Egypt which will grant Saudi Arabia a return on its investment, Reuters reports.

Anita Fatunji