Will the agreement to transport UAE oil to Europe via Israel...

Will the agreement to transport UAE oil to Europe via Israel...
Will the agreement to transport UAE oil to Europe via Israel...

Cairo – Masrawy:

The Israeli European Asia Pipeline Company “EAPC” signed a memorandum of understanding with the “Mid Red Land Bridge” company, based in Abu Dhabi, in order to supply Emirati oil to Europe through the use of the “Eilat-Ashkelon” pipeline linking the Red and Mediterranean Bahrain.

The two companies plan to establish a land bridge to transport oil that saves time and fuel compared to transport through the Suez Canal, which may affect some of the canal revenues, which may allow the transfer of oil produced in the Gulf to consumers in Europe, as well as oil produced in the Mediterranean and the Black Sea to the Far East regions. .

Some Israeli newspapers indicated that there are two options for transporting oil between the Emirates and the port of Eilat, which are either using oil tankers across the Red Sea, or by establishing a pipeline that extends into Saudi territory, which depends on Saudi approval as well.

Also, one of the options presented in the picture is to transport oil via a railway line between the Emirates and the port of Eilat.

The Israeli company said that this agreement will contribute to raising the quantities of oil that it transports through this pipeline to tens of millions of tons annually.

This initial agreement comes only about two months after the signing of a peace agreement between the UAE and Israel under the auspices of the United States of America.

The “Mid Red Land Bridge” company is a joint venture between Petromal, which works in the field of integrated services in the oil and gas sector, and is headquartered in the UAE capital, Abu Dhabi, and other Israeli companies.

Does this project affect the revenues of the Suez Canal?

It is expected that the impact of this project will be limited to the revenues of the Suez Canal, according to what Lieutenant General Osama Rabie, head of the Suez Canal Authority, said in televised statements, about a month ago – the time of discussions and study of the project.

Rabie pointed out that the Suez Canal currently acquires 66% of the total quantities of crude oil likely to cross from the canal, which amount to about 107 million tons, compared to the “Eilat-Ashkelon” line with quantities of 55 million tons.

Rabie explained that the use of railways in transporting goods between the Emirates and the Israeli line would be high in cost and the quantities of transported goods would be much less than if they were transported by sea.

Nevertheless, Rabei sees the need to work on developing a new price and marketing plan, and the presence of new industries in the Suez Canal Economic Zone that attracts ships to the ports of East Port Said and Sokhna, and thus the transit of these ships from the Suez Canal.

Rabei added, “All these topics are currently being studied and we are talking about, so that there are always new solutions with us, if this topic increases to the competitive edge that may concern us, but so far the process is limited and under control.”

He pointed out that the effects of transporting Gulf goods to Europe through this line depend on the Suez Canal only despite its expected limitations, but it may also extend to the work of some distinct ports in Saudi Arabia, the Emirates, Bahrain, Qatar and Oman, which will be placed in the UAE and Gulf accounts when making this agreement. In addition to the high cost factor of transporting goods.

Rabei said, “We are still betting on Arabism and that intra-trade between the UAE and Israel of specific commodities is required and necessary, but does not affect the Suez Canal significantly.”

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