Libya declares force majeure on oil production amid continued attacks, instability
Date
8/26/2024 7:32:29 AM
(MENAFN) The Libyan parliament government has declared a state of force majeure on all oil fields, ports, institutions, and facilities, effectively halting oil production and exports until further notice. This drastic measure follows repeated attacks by unauthorized groups on the Central bank of Libya's leadership, employees, and administrative staff. The government’s decision aims to protect public assets, including the country's oil revenues, which are at risk of falling into the hands of illegitimate factions seeking to control them. The force majeure declaration underscores the severe impact of ongoing instability on Libya's oil sector, which had previously achieved significant production levels.
In June, Libya's oil production had reached 1.5 million barrels per day, reflecting a strong output that is now jeopardized by the recent developments. The acting Minister of Oil and Gas, Khalifa Abdul Sadiq, had outlined an ambitious plan to increase production to 1.4 million barrels per day by the end of 2024 and eventually to 2 million barrels per day over the next three years. This plan involved a USD17 billion investment aimed at developing and rehabilitating oil fields and reopening closed wells. However, the current disruption casts uncertainty over these goals, delaying progress in Libya’s oil sector.
The Libyan National Oil Corporation had been spearheading efforts to boost oil production, but the recent violence and unrest have severely impacted these plans. The government’s declaration reflects both a response to immediate threats and a strategic measure to safeguard the country’s oil wealth amid ongoing challenges. As the situation evolves, Libya’s oil production capabilities and investment plans remain in flux, highlighting the broader implications of political instability on the country's economic ambitions.
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