Egypt may step in to buy Iranian oil

Iran and Egypt are in preliminary talks to complete an oil deal, the Wall Street Journal reported Monday.

Iran would like to sell Egypt crude that is sitting in the port of Sidi Kerir in Egypt and can’t move due to international sanctions. The report said officials in both countries have attested to the potential deal.

“Between Iran and Egypt, there is some discussion. There is the idea they [will] import some oil from Iran,” the report quoted an official in Tehran as saying.

Egyptian President Mohammed Morsi visited Iran last month for a meeting of the Non-Aligned Movement and met with President Mahmoud Ahmadinejad.

Both the United States and the European Union have placed Iranian oil under sanctions in an attempt to cripple the country’s economy and convince it to abandon its nuclear program.

Iran has lost approximately 900,000 barrels a day in sales due to sanctions and Egypt only uses 709,000 barrels a day, the report said. If the two countries reach an oil deal it won’t make up for Iran’s loss, but will help the Islamic Republic recapture some of its lost sales.

Iran has attempted to skirt the sanctions by masking its ships to look as if they are from other countries by reflagging them, and still maintains economic ties with a number of Asian countries, including India and South Korea.

Cairo and Tehran shared frosty relations between 1979 and 2011, but analysts have seen signs of a thaw between the two since Islamist Morsi became president of Egypt.

Morsi has denied his country is moving closer to Iran.