The Es Sider oil export terminal in Libya was shut down and loadings at another one, Ras Lanuf, were suspended today after clashes between the Libyan national Army and the Benghazi Defense Brigades, Reuters reports, citing local sources.
At least one oil storage tank in Ras Lanuf has been set on fire, but oilfields have not been affected by the clashes yet, the sources said.
According to one of them, from the military, the first attack was launched by the BDB—an Islamist group and long-standing foe of the LNA—as it attempted to take control of the Oil Crescent and move on to Benghazi, which has been under the control of Khalifa Haftar’s LNA since last year.
The LNA took control over the Oil Crescent, including the four export terminals, back in 2016 after a prolonged blockade by the Petroleum Facilities Guard. It then transferred control of the area to the National Oil Corporation.
Libya has the biggest crude oil reserves in Africa, but the country has had a hard time getting back on its feet after the toppling of Muammar Gaddafi and getting its oil industry back on track.
Because of the frequent production outages, Libya has become a major oil price swing factor, and this state of affairs is set to continue in the absence of any sign that the political chaos is about to end anytime soon. Related: China’s Oil Demand Could Take A Big Hit
The latest outage was in May, when a militant group attacked the pipeline feeding crude from the Waha oil field to Es Sider, costing the field operators around 80,000 bpd in lost production. This was the second attack on this pipeline in five months. Waha produces 300,000 bpd, on par with Libya’s largest field, El Sharara, which has also been the target of several attacks.
To date, Libya’s oil production is still relatively stable at about 1 million barrels daily, with field and pipeline outages proving brief for the time being. Still, as many of these have happened at fields that produce a substantial portion of the national total, they have had an immediate effect on prices.
By Irina Slav for Oilprice.com
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