West News Wire: The closure of Libya’s oil facilities is costing the country tens of millions of dollars every day, while global oil prices are at their highest in years, according to the country’s oil minister.
Oil is the lifeline of the North African country, which has struggled to recover from a decade of strife since longtime leader Muammar Gaddafi was deposed in a NATO-backed rebellion in 2011. Libya’s two major export ports and many oil fields, however, have been held captive by the country’s newest internal crisis since mid-April.
In an interview with AFP at his office in Tripoli, Minister of Oil and Gas Mohammed Aoun stated, “Production has plummeted by roughly 600,000 barrels a day,” which is half of the previous level.
“Calculating the sale price at $100 a barrel, losses are at least $60m daily,” he said.
Since Russia began its invasion of Ukraine in February, triggering Western sanctions, global crude prices have reached levels unseen since 2014. On Friday the US benchmark West Texas Intermediate crude traded above $106 per barrel. The price of Brent crude exceeded $109 a barrel.
The Libyan closures follow the selection in February of a new prime minister, Fathi Bashagha, by Libya’s eastern-based parliament in a direct challenge to Tripoli-based interim Prime Minister Abdulhamid Dbeibah.
Analysts have said eastern Libyan forces who back Bashagha have forced the closure of the oil facilities in a bid to press Dbeibah to step down, but the incumbent has insisted he will only hand power to an elected successor.
The political bloc supporting Bashagha is aligned with Libya’s eastern-based strongman Khalifa Haftar, who in 2019-20 led a failed offensive against Tripoli, accompanied by his forces blockading oilfields.
Haftar’s external backers include Russia, which belongs to the OPEC+ crude producers’ group.
On the political dimensions of the shutdown, Aoun limited himself to saying, “Apparently, those calling for the closure say they have claims for development of their regions.”