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Israel Buying Oil from Mexico to Offset Shortages from Iran

December 29, 1978
See Original Daily Bulletin From This Date

Officials of the Energy Ministry said today that Israel was in no danger of running out of oil despite the drastic curtailment of production in strife-torn Iran which supplies about 70 percent of the country’s annual needs. They said Israel was maintaining its requirements through purchases of Mexican oil and the production of the off-shore oil fields in Sinai.

They also said Israel was planning to import cool and explore shale oil reserves. They acknowledged that Mexican oil costs five percent more than oil from Iran. The Sinai oil fields are to be returned to Egypt under a peace treaty but Israel is seeking a treaty guarantee of access to that oil at regular market prices.

Meanwhile, the U.S. is committed to provide Israel with adequate oil supplies in case of an emergency. The American guarantee was given to compensate Israel for relinquishing the oil fields in western Sinai under its 1975 interim agreement with Egypt. The Energy Ministry said that Israel currently imports about 7.3 million tons of oil a year at a cost of $700 million. The Sinai fields produce 25,000 barrels a day, about one-sixth of Israel’s needs.

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