Nearly 140,000 tons of Russian fuel oil and vacuum gasoil (VGO) loaded in May were destined for ship-to-ship (STS) transfers near Port Said, Egypt, LSEG data shows, highlighting the country’s growing role as an energy transit node for opaque trade flows amid sanctions uncertainty and mounting domestic energy costs.
While the data does not show that Egypt was the final buyer of the cargoes, it places Egyptian waters back at the center of the rerouted trade in Russian oil products.
In this reshaped market, STS transfers, storage, and blending have become increasingly critical since Western sanctions and the European Union embargo pushed Russian refined products away from European markets.
Russia’s seaborne exports of fuel oil and VGO fell by about 6% month-on-month in May to 3.2 million tons, as Ukrainian drone strikes curtailed refinery output and shipments. Saudi Arabia remained the top buyer, receiving 1.23 million tons, despite a 17% decline from April.
For Egypt, the Port Said transfers reflect a broader duality in its energy policy. Cairo is trying to secure fuel for electricity generation and industry following repeated natural gas supply shocks, while simultaneously capitalizing on its geography as a transit and storage hub for crisis-driven energy flows.
Port Said sits at the northern entrance to the Suez Canal, while Ain Sokhna and the SUMED pipeline connect the Red Sea and Mediterranean energy routes. This infrastructure has become increasingly strategic as the war on Iran, disruptions around the Strait of Hormuz, and sanctions on Russian oil reshape global trade routes.
However, this role is politically and legally sensitive. Russian fuel-oil flows sit at the intersection of sanctions enforcement, opaque shipping practices, and energy security.
When cargoes are transferred at sea and their final destination is unclear, tracking whether Russian-origin products are being blended, stored, or resold into other markets becomes significantly more challenging.
This is not the first time Port Said has played such a role. In March, two tankers loaded with approximately 240,000 tons of Russian naphtha carried out STS operations at the Port Said anchorage and off Togo before delivering the feedstock to Singapore.
Moreover, STS operations involving naphtha and fuel oil loaded at Russian ports exceeded 200,000 tons at Al Hoceima and Port Said in February.
Egypt has also served as a more direct destination for Russian fuel oil since the invasion of Ukraine. In April 2024, Russian fuel oil and VGO supplies to Egypt rose to nearly 500,000 tons from 100,000 tons the previous month, with all cargoes discharged at Ain Sokhna.
Traders said at the time that Ain Sokhna was being used for storage and blending, and that the fuel oil was being procured for power generation ahead of summer.
The latest data comes as Egypt remains exposed to volatile energy imports. The government has raised fuel prices and natural gas prices for several energy-intensive industries this year.
Meanwhile, Prime Minister Mostafa Madbouly said the country’s imported natural gas bill had jumped from $560 million to about $1.65 billion a month after the regional war drove up energy costs.
Israeli gas disruptions have added another layer of vulnerability. Tel Aviv had previously reduced gas exports to Egypt amid regional escalation, affecting roughly 1.2 billion cubic feet per day (bcf/d) from the Tamar and Leviathan fields. Egypt’s domestic gas demand stands at about 6.2 billion bcf/d, compared with domestic production of between 4.1–4.2 bcf/d.
While the specific vessels and final buyers for the May cargoes remain unidentified, these STS operations are part of a recurring, multi-month pattern. In 2026 alone, several shipments of Russian fuel oil and naphtha have utilized the Port Said anchorage.
Additionally, shadow fleet tankers have been actively routing through this node as recently as June 14, when the British Royal Navy intercepted a Cameroon-flagged tanker that had departed Russia’s Luga Bay port with Port Said listed as its destination.
The immediate question raised by the latest data, however, is not whether Egypt is the destination of Russian cargoes, but whether Egyptian waters are becoming a routine logistics point in a trade designed to keep Russian products moving opaquely despite sanctions pressure. This shift potentially exposes Cairo to the risk of secondary sanctions.
If so, Egypt’s official energy-hub strategy will increasingly depend on infrastructure that serves a dual purpose. While it can strengthen supply security during regional shocks, it can also make the country an intermediary in opaque fossil-fuel flows whose beneficiaries and final buyers remain elusive.
