Libya to Declare Force Majeure On Oil Exports From Key Terminals
As soon as can be, Libya’s National Oil Corporation (NOC) may declare force majeure on oil exports from several key export terminals in the Gulf of Sirte.
The situation is coming amid continued blockades and closures of Libya’s oil-producing and export infrastructure, the corporation said yesterday, as political crisis continue to rip the north African country apart.
The Libya owned state oil company said in a statement that it is considering declaring force majeure within the next 72 hours unless production and shipment of oil resume in the Gulf of Sirte.
The Gulf of Sirte hosts the oil export terminals Zueitina, Brega, Ras Lanuf, and Es Sider.
In the statement, chairman of NOC, Mustafa Sanalla, said government is responsible for the sovereignty of its institutions, and no individual, minister, or entity should be allowed to politicize the oil sector to use it as a bargaining chip in any negotiations, bargaining.
Talks about possible force majeure is coming after weeks of protests and closures amid the new rift in Libya’s political class over who should be governing the country.
Libya is perhaps the only country in recent history with two heads of government. The most recent rivalry in the country is between Fathi Bashaga, the Prime Minister appointed by the parliament earlier this year, and Prime Minister Abdul Hamid Dbeibah, who was appointed last year through a process backed by the United Nations.
Dbeibah refuses to cede power. Bashaga is now based in Sirte in the east of Libya, while Dbeibah is based in Tripoli. Both are occupying strategic locations in the country.
The most recent blockades of oil ports have been mostly instigated by factions in the east, including such allied with eastern strongman Khalifa Haftar and the Libyan National Army (LNA) he leads.
News reports say Libya’s oil production has suffered since April, with output estimated at below 1 million barrels per day (bpd), with some reports suggesting it may have been as low as 100,000 bpd two weeks ago.
Amid the political instability, Libyan oil production is also unstable, and shutdowns of exports could occur at any time, further tightening the global oil market, which is already tight on supply.