US-owned gas tanker catches fire after drone attack at Egypt port as Middle East tensions rise

A drone strike ignited a fire that engulfed two gas vessels at Egypt’s Mediterranean port of Damietta, the Egyptian cabinet confirmed on Thursday, stating the blaze was the result of an attack rather than an accident.

The incident, which occurred near the strategically vital Suez Canal – a crucial evacuation route for Saudi oil to global markets – has yet to be claimed by any party.

Authorities have launched an investigation and are implementing measures to safeguard Egypt’s national security. British maritime security firm Ambrey had initially assessed on Wednesday that a drone struck a US-owned gas storage tanker at the port, raising concerns about a potential escalation of conflict across the Middle East.

Trading sources familiar with the event identified the affected vessels as the floating storage tanker Energos Winter and the Gaslog Salem, with the fire reportedly starting on the starboard side of the Energos Winter before spreading.

The drone attack unfolded shortly after Iran launched a missile strike against US forces in Jordan, and following retaliatory actions by Washington and Saudi Arabia against Iran-backed paramilitary groups in Iraq.

US president Donald Trump had threatened retaliation against Iran, while Yemen’s Houthi group declared a naval blockade on Saudi Arabia, indicating a widening of the conflict since the US and Israel began bombing Iran in February.

Egypt’s petroleum ministry confirmed on Wednesday that the fires were swiftly brought under control by firefighting and security teams, with no injuries or fatalities reported. Petroleum Minister Karim Badawi visited the site to oversee the response efforts.

The Energos Winter, a floating storage and regasification unit, is owned by US-based Energos Infrastructure and managed by Wilhelmsen Ship Management, a Singapore-based subsidiary of Norway’s Wilhelmsen Group.

The incident arrives at a sensitive juncture for Egypt’s gas market. Having become an LNG exporter following the development of the giant Zohr offshore gas field, Egypt has recently reverted to being a significant LNG buyer due to declining domestic production and surging demand. Any prolonged disruption could significantly impact LNG traders, affecting demand and spot prices.

Sources indicate that the vessels are expected to remain out of service for an extended period, with one reporting a breach in a tank on the Energos Winter, potentially prolonging repair work.

The Energos Winter possesses a regasification capacity of approximately 450 million cubic feet per day, which accounts for roughly 7 per cent of Egypt’s daily gas consumption and 16 per cent of its total LNG receiving and regasification capacity, according to Egyptian consultancy ElAdl Studies.

While the outage is not anticipated to create an immediate supply gap, given Egypt’s alternative import facilities and fuel options, it will reduce spare capacity during a period of peak summer demand.

Potential mitigation strategies include maximising other regasification units, increasing the use of fuel oil as a backup, tapping into renewable energy capacity, and, as a last resort, temporarily reducing gas supplies to certain industrial sectors.