• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 2 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 5 hours How Far Have We Really Gotten With Alternative Energy
  • 7 hours If hydrogen is the answer, you're asking the wrong question
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 5 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 20 hours Biden's $2 trillion Plan for Insfrastructure and Jobs
  • 4 days "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
Oil Steady as EIA Confirms Crude, Gasoline Draws

Oil Steady as EIA Confirms Crude, Gasoline Draws

Oil prices retained gains on…

OPEC Remains Upbeat About Oil Demand

OPEC Remains Upbeat About Oil Demand

OPEC remains optimistic that the…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Mysterious Outage In Libya Could Drive Oil Prices Higher

It’s been a rollercoaster ride for Libya’s oil sector the last few months. With production from this important OPEC player swinging wildly with unstable politics in the country.

And news this week suggests things just got worse for Libya’s oil industry — in a major way.

Unnamed sources in the country told Bloomberg Wednesday that Libya’s largest oil field, Sharara, has been suddenly shut in. With the pipeline carrying crude from this massive operation having been completely idled.

As a result, sources said Libya’s overall oil production has now fallen to 560,000 barrels per day. Coming just days after Libya’s National Oil Corp. had publicly pegged the country’s production at 700,000 b/d.

That suggests the stoppage at Sharara has lowered production by 140,000 b/d — representing a 20% decline. With the shortfall happening virtually overnight, and with no apparent warning to oil traders.

Here’s the most important point: sources in Libya didn’t give any reason for the outage. Making it difficult to tell if the drop in production will be a prolonged event.

The most likely candidate is political instability. With numerous oil facilities across Libya having seen shutdowns in recent months due to fighting between the country’s national army and various rebel factions. Related: OPEC Compliance Nears 100% On Libyan, Nigerian Outages

In fact, the country’s Es Sider oil export terminal had just reopened for shipments this week — after a three-week stoppage, during which the rebel Benghazi Defense Brigades briefly took control of the facility.

Sources commenting on this latest outage did note that crude exports have now been halted at two other Libya oil terminals: Zawiya and Mellitah. Although it wasn’t clear if the problem is at these facilities themselves, or due to problems with the pipelines feeding the terminals.

Whatever the case, this disruption is an important event for crude prices. With Brent jumping $1.12 per barrel on the news, putting it solidly above $50. Watch for more news from Libya on whether production from Sharara can be restored soon — if not, we could see more upward momentum for oil.

Here’s to on-again, off-again.

ADVERTISEMENT

By Dave Forest

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • Radu on March 30 2017 said:
    It wouldn't be surprising if oil companies themselves are behind this unrest. It clearly benefits them financially.

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News