Iraq has agreed to provide both Egypt and Sudan with crude oil to be purchased on letter of credit (L/C) terms, according to Egyptian state media reports.

The news follows reports that the National Bank of Egypt has agreed to provide L/Cs to Egyptian General Petroleum Corporation to the value of US$1 billion for purchases of Libyan crude oil (DC World News, 26 June 2013).

International banks

Iraq has so far only agreed in principle to provide both Egypt and Sudan with crude oil on L/C terms according to MENA, the Egyptian state news agency.

According to MENA, oil shipments will only begin once Egypt and Sudan obtain L/Cs from international banks and Iraq's cabinet issues its final approval of the deal.

Egyptian arrangements

According to an Iraqi petroleum ministry official, the agreement has recently been signed with Egyptian counterparts.

Under the agreement, Iraq would ensure monthly shipments of four million barrels of crude oil to Egypt via the Sumo Oil Marketing Company.

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