Libya Supply Outage Sparks Uncertainty in Oil Markets

Oil prices started the week with a major spike on the back of Khalifa Haftar’s Benghazi-based government declaring a nationwide halt of all oil production and exports.

One of the two rival powers in Libya, the Benghazi government run by Field Marshal Khalifa Haftar said it would shut down all crude output and exports in the country, declaring a nationwide force majeure.

The decision comes amidst an escalating dispute over who should appoint NOC officials and control oil revenues, aggravated by the kidnapping of Central Bank officials and growing calls to investigate potential misuse of Libya’s financial resources.

Even the Tripoli-based government has called for institutional change, demanding that central bank governor Sadiq al-Kabir be replaced, a key position given that all crude oil revenues flow into the central bank.

Having recovered from the oil blockades of 2020 and 2022, Libya’s production has been relatively stable at 1.2 million b/d lately, with a little more than 1 million b/d exported to the global markets.

Source: oilprice.com

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