Libya: Oil output collapses after wave of closures

oil and gas - June 15, 2022

Libya's oil output is 100,000-150,000 barrels per day (bpd), a spokesman for the Oil Ministry said on Tuesday, and a fraction of normal levels due to the shutdown of production and export facilities as a tactic in the country's political stalemate, Reuters reports.

Libyan oil output last year was more than 1.2 million bpd and the reduced production adds to the pressure on markets already squeezed by tight supply elsewhere.

The Oil Ministry spokesman said Libya was facing a daily loss in export revenue of $70 million-80 million as a result of the shutdowns. National Oil Corporation has not recently commented on oil output.

The political dispute over the control of government that is driving the shutdown, meanwhile, shows signs of escalating, making any swift return of Libyan oil to global markets uncertain.

Tripoli-based Prime Minister, Abdulhamid Al-Dbeibah has refused to hand over power to Fathi Bashagha, who was appointed to replace him by the eastern-based parliament in March.

Groups at oil facilities have demanded that Dbeibah quit in favour of Bashagha. Analysts say the main force behind the blockade is eastern commander, Khalifa Haftar's Libyan National Army (LNA). It has not commented on that charge, but LNA figures urged an oil shutdown in April.

Production at Sharara field, Libya's biggest, briefly resumed last week before being shut down again.

The current status of several facilities remains unclear after last week, when groups said they had shut down Ras Lanuf and Es Sider terminals and threatened to shut down Hariga terminal, leading to a reduction in output from Sarir field.

Despite those statements, one tanker was allowed to finish loading at Es Sider on Thursday and another was allowed to dock on Tuesday, though it is not clear if it has been allowed to load.

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