Libya’s crude oil production has reached 800,000 bpd, Reuters has reported, citing sources in the know. This is a 100,000-bpd increase in just a few days, the report added.
Libya started ramping up oil production in late September when the Libyan national Army agreed to a ceasefire with the Government of National Accord and lifted its blockade from oil facilities.
During the more than eight months of the blockade, Libya’s oil output slumped from over 1 million bpd to less than 100,000 bpd. Since the lifting of the blockade, however, the National Oil Corporation has been restoring production in leaps and bounds.
Within a month, production rebounded to 500,000 bpd, with the largest field in Libya, Sharara, restarting in October. Now, NOC seems to be on track to reach its stated target of 1 million bpd before the end of the year. This flies in the face of expectations that it would take the North African country several months to restore its oil production and has pressured oil prices significantly.
Meanwhile, Libya’s finance minister has put a price on the oil terminal blockades that have plagued the industry for years after the official end of the civil war. This price is $130 billion in lost revenues, according to Faraj Boumtari.
The most recent blockade in Libya, between January and the middle of September, has cost the country almost $10 billion, the National Oil Corporation said, describing it as “a devastating loss most especially during this period of national crisis.”
Not everyone is confident that the rebound will last, however. As Cyril Widdershoven pointed out in a recent analysis for Oilprice, the political situation in the country remains highly volatile, which makes more blockades and production outages very likely based on recent history. The most recent news in this respect came from Tripoli: the Prime Minister of the GNA cabinet, Fayez al-Serraj, had withdrawn his resignation, remaining at his post until a replacement is found as negotiations with the LNA about the future organization of power in Libya continue.
By Irina Slav for Oilprice.com