The National Oil Company (NOC) of Libya has lifted its force majeure – which enables a firm to use unforeseen developments to escape contractual obligations – on the country’s ports and oil fields.
The announcement follows the lifting of the blockade of facilities by groups aligned with the eastern-based Libyan National Army (LNA), which is led by Khalifa Hifter. According to the NOC, the months-long blockade had caused oil production to drop by 850,000 barrels per day (bpd).
The end to the standoff is thought to have come about due to the replacement of Mustafa Sanalla as boss of the NOC as part of a deal that will likely allow Prime Minister Abdul Hamid Dbeibah to remain in power. The new head, Farhat Bengdara, is an ally of Hifter, and he met recently with the tribal groups behind the blockade.
Bengdara recently spoke at NOC headquarters in Tripoli, saying:
“It’s vitally important under the current conditions that Libya regains its oil and gas export capacity as quickly as possible. The oil sector has fallen prey to political struggles, but we will work to prevent political interference.”
International oil companies like TotalEnergies, the maker of Total metalworking products, have expressed interest in developing assets in Libya. The resumption of greater oil production in Libya, which has at times reached 1.2 million bpd in recent years, will help alleviate the tightness in the oil markets following Russia’s invasion of Ukraine.
Libya has convenient European market access and the largest proven oil reserves on the African continent.
