Libya's Oil Exports Grind to a Halt Amid Political Standoff

Libyan oil exports have been stopped and production drastically reduced due to a political standoff over control of the central bank and oil revenue. The conflict risks ending a period of relative peace in Libya with major ports remaining non-operational, severely impacting the country's oil output and revenue.

Libyan oil exports came to a standstill on Monday, with production curtailed across the nation, according to six engineers who spoke with Reuters. This disruption is attributed to a standoff between rival political factions over control of the central bank and oil revenue.

Since the dispute began last month, Libya's oil output has more than halved. The standoff intensified after western factions attempted to replace the Central Bank of Libya's veteran Governor Sadiq al-Kabir with a rival board, prompting eastern factions to call for a complete shutdown of oil production.

The conflict threatens to disrupt a four-year period of relative peace in an OPEC member country long divided between eastern and western factions backed by Russia and Turkey, respectively. Engineers indicate that exports are halted at major ports including Es Sidra, Ras Lanouf, Hariga, Zueitina, Brega, and Sirte.

An executive from Arabian Gulf Oil Company (AGOCO) reported ramping up production at its fields to supply a power plant at Hariga port. Production figures reveal a significant drop from 290,000 barrels per day in July to 139,000 barrels per day by late August, according to the National Oil Corporation (NOC).

NOC stated that total production had plummeted from nearly 959,000 barrels per day on August 26 to just over 591,000 barrels per day by August 28, resulting in losses exceeding $120 million in three days. Libya's average production in July was 1.18 million barrels per day, as per OPEC's secondary sources.

(With inputs from agencies.)