Egypt's Delicate Balancing Act in the Iran Conflict
Egypt is struggling to maintain neutrality amid the US-Israel-Iran war, facing pressure from Gulf allies and economic losses. Suez Canal revenues have dropped, tourism has declined, and prices have risen, while Cairo tries to mediate and avoid direct involvement.
Egypt, a close ally of the US and Gulf states and signatory of the 1979 Camp David Accords with Israel, finds itself in a diplomatic and strategic dilemma due to the Iran conflict. In early 2026, it was on the verge of restoring full diplomatic ties with Tehran, but now it walks a tightrope.
Cairo has publicly condemned Iranian attacks on Gulf states while providing only limited military support. It has positioned itself as a mediator between Tehran and Washington, alongside Pakistan, Turkey, and Qatar. President Abdel-Fattah el-Sissi visited the United Arab Emirates in May.
Analysts say Egypt's core objective is to stay out of the war while containing its economic and security fallout. However, this approach has caused tensions with Gulf partners, especially the UAE, who expect support against Iranian attacks. Statements from UAE officials on social media have expressed frustration.
Economically, the war has hurt Egypt. After Iran-aligned Houthi militants resumed attacks on Red Sea shipping, Suez Canal revenues fell by 38% in the first quarter of 2026. Tourism has plummeted, and energy and food prices have risen. Although Egypt's economy had been recovering thanks to Gulf investments—including $35 billion from the UAE—the outlook is worsening.
Diplomatically, US President Donald Trump has urged Egypt to normalize relations with Israel as part of the Abraham Accords. But Egypt is wary of strengthening Israeli regional dominance and is reluctant to offer additional diplomatic support. Public opinion in Egypt largely sides with Iran, so the government avoids overt backing of US-Israeli actions. Meanwhile, crackdowns on dissent continue, and human rights groups report worsening conditions.
