Only an immediate ceasefire in Tripoli will avoid a severely adverse impact on Libya’s oil, head of the National Oil Corporation (NOC) Mostafa Sanalla told Bloomberg Wednesday.
Sanalla said the fighting that erupted between Khalifa Hafar, General Commander of Libyan National Army (LNA), and Faiez al-Sarraj, head of the UN-recognised Government of the National Accord (GNA) over Tripoli and power since early April will hit the oil sector hard.
Sanalla’s statements come a few days after the OPEC expressed concern over the escalating situation in Libya and its impact on the rising oil production after a force majeure had been lifted from el-Sharara oilfield in early March.
The NOC chairman added that the battles are threatening oil production as the Libyan oil sector is suffering from supply shortages, especially fuel, and catering needed to maintain operations at the oil fields in southern and western regions.
He mentioned the April 10 incident in which a bomb struck an oil facility located on Tripoli’s outskirts.
“The war has forced Libya’s oil aviation service, Petro Air, to halt many of its flights, affecting crew changes at a number of fields,” Sanalla said.
On May 1, Bloomberg reported
that production had risen by 90,000 barrels a day to 1.19 million per day.
Further, the fighting is threatening workers’ lives due to the lack of security, Sanalla said, alluding to the abduction of an oil employee near Sirte a week ago and threats that the others have received by telephone.
“In Tripoli, key personnel cannot cross the city from their homes into our headquarters due to the fighting. Larger projects have been disrupted by the evacuation from Libya of international oil company staff,” Sanalla said in the interview.
Meanwhile, some evidence has been found of attempts made to sell Libya’s oil illegally through parallel entities, he added.
He reiterated that the Islamic States and the armed groups in the southern regions will exploit the tension and civil war to re-establish themselves in a threat to the region’s “critical infrastructure,” producing up to 370,000 barrels per day.
“Only a ceasefire and a return to the dual-key system will return stability to Libya’s oil sector. Libya’s civil conflict has raged for too long, and it is tempting to seek to break the deadlock once and for all,” Sanalla emphasized.
In March, before Haftar’s campaign on Tripoli April 4, oil revenues had increased by more than $1.5 billion in March, up to 20% compared with February.