Egyptian billionaire Ahmed Ezz’s Ezz Steel hit by 30% gas cut as $120 million LNG cargoes squeeze Egypt

Egyptian billionaire Ahmed Ezz’s Ezz Steel, the Arab world’s largest steelmaker, has been hit with a 30% cut in natural gas supplies as soaring import costs force Cairo to ration fuel to heavy industry.

The government notified Ezz Steel of the cut, which took effect on Sunday and removes about 30 million cubic feet of gas a day from the company’s supply, EnterpriseAM reported, citing government officials quoted by Asharq Business. Rival integrated producers Suez Steel and Beshay Steel face the same 30% reduction, according to industry publication GMK Center.

The company has not publicly responded to the cut, and the government has not set an end date for it.

The move deepens a rationing program that began with heavier users. On Nov. 1, the government cut gas to fertilizer and methanol plants by 20%, and it has since raised those curtailments to 33%. Methanol producer Mopco is so far the only company to confirm the higher cut in a stock exchange filing.

Behind the squeeze is a sharp jump in the cost of liquefied natural gas. The Asian benchmark price rose about 36% in October to more than $34 per million British thermal units, and one official put the cost of a single spot cargo at close to $120 million. Egypt has deferred five of the 15 cargoes contracted for November.

As a result, the cut lands on one of Egypt’s biggest industrial groups. Ezz Steel has annual design capacity of about 7 million tons, split between 4.7 million tons of long products such as rebar and 2.3 million tons of flat steel, and it produced roughly 6.4 million tons of crude steel in 2024.

Because the company is fully integrated, the reduction is expected to fall mainly on its direct reduced iron units, where gas is used to strip oxygen from iron ore. That gives steelmakers more room than fertilizer plants, which use gas as a raw material and must slow output as soon as supplies fall.

However, industry leaders warn that the cushion is thin. Hassan El Marakby, vice chairman of the metallurgical chamber at the Federation of Egyptian Industries, said mills hold no significant surplus inventory and that any cut below current production levels would have a “definite negative impact.” Mills can replace lost output by importing scrap or iron, but that would raise costs and increase demand for scarce foreign currency.

Ezz, who owns about 66.45% of the company, had been counting on the domestic market for growth. Billionaires.Africa reported in January that Ezz Steel planned to invest $1.16 billion over two years to expand capacity as trade barriers abroad squeezed its exports, which reached $1.6 billion in 2024.

The gas crunch also threatens Egypt’s export earnings more broadly. Chemical and fertilizer exports rose 34% to $9.54 billion in the first nine months of 2026, and the plants now being throttled are among the country’s strongest sources of dollars.

Egypt has rationed gas to industry before, most recently during the summer 2024 shortage that halted fertilizer and petrochemical output. Meanwhile, the government has set up a permanent committee to monitor supplies and prices of steel billets for smaller rolling mills.

As a result, how long the cut lasts will determine whether Ezz can keep its mills running at full speed through the winter.