Libya oil exports hit an 18-month low on port and field closures

Stephen Voss 5/3/2022

(Bloomberg) — Armed clashes, damaged storage tanks and political protests at key ports have hobbled Libya’s ability to export oil, cutting shipments to the lowest level since October 2020.

The North African country loaded 819,000 barrels a day last month, down from 979,000 barrels a day in March, according to tanker-tracking data monitored by Bloomberg. Fewer cargoes headed to the country’s biggest customers in Italy, Spain and China.

Libya’s oil industry earns badly needed foreign revenue for the OPEC nation, which has been mired in conflict for much of the period since the 2011 fall of dictator Moammar Al Qaddafi. A second period of civil war was supposed to have ended with a cease-fire accord in October 2020.

Political strife has escalated again in recent months though, with protests calling for Prime Minister Abdul Hamid Dbeibah to quit engulfing major facilities, including oil fields and ports. Dbeibah is resisting demands from some lawmakers to resign after they declared former interior minister Fathi Bashagha as prime minister in February.

The state-owned National Oil Corp. said Monday it is temporarily lifting a force majeure closure at the eastern port of Zueitina, after formally suspended loadings from that location in the middle of April. 

The temporary measure will avoid an “environmental catastrophe” if the tanks aren’t emptied. Armed clashes damaged facilities at 29 sites, including oil storage tanks at the western port of Zawiya, the NOC said on April 23.

Giant oil fields such as Sharara and El Feel have also fallen victim to political demonstrations against the prime minister. Nationwide oil production fell to about 800,000 barrels a day from 1.3 million barrels a day within the space of just a few days in mid April, according to an oil official who asked not to be identified because the information is private.

Oil Minister Mohamed Oun said a week ago he was optimistic of a swift end to the closures, after meeting tribal leaders.

Nationwide production has fallen by about 600,000 barrels a day, to half its prior level, costing at least $60 million a day in lost revenue, the minister told Agence France-Presse in an interview April 29.

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