Al-Basra oil terminal in Iraq (Photo: Reuters)
Iraq's oil ministry said on Thursday it had begun loading a tanker with 2 million barrels of crude oil bound for Egypt, marking the first shipment under a bilateral agreement.
Under a one-year agreement reached last month between Baghdad and Cairo, Iraq will sell 12 million barrels of oil to Egypt, the ministry said.
Thursday's announcement comes a couple of months after Iraqi envoy to Egypt Habib Al-Sadr said in press statements that Iraq's oil marketing company SOMO had inked the supply contract.
Al-Sadr said that Iraqi and Egyptian officials finalised the technical aspects of the contract after receiving the green light from their respective political leadership. Tarek El-Hadidi, the head of Egypt's state oil company EGPC, had recently confirmed that a deal was signed with the Iraqi government to import Iraqi oil under a one-year agreement, which could be renewed.
Egypt has been aiming to procure oil for domestic market needs from several sources since November 2016, when Saudi national oil company Aramco halted shipments of oil products to Cairo that had been part of a multi-billion dollar aid deal.
However, Aramco decided last March to resume oil shipments to Egypt following a six-month suspension as a sign of warming relations between the two countries following a period of reportedly strained relations.