Libya’s oil production is expected to return to pre-shutdown levels within three to four days, according to industry sources cited by Bloomberg. The resumption follows the government’s decision to lift the force majeure on oil fields and ports.
The sources confirmed that production has resumed at the Sharara oil field, which was shut down in early August. This marks a key step in Libya’s efforts to restore its oil output.
Bloomberg reported that the return of Libyan oil to the market could further depress global crude prices, pushing them below $75 per barrel amid weak global demand.
The decision to resume production and exports came after an agreement between representatives from the House of Representatives and the High Council of State to appoint a new Central Bank Governor, Naji Essa, and a deputy, Maree Al-Barassi. This move followed the dismissal of the former governor, Sadiq Al-Kabir, amid a central bank crisis.
Before the shutdown, Libya was producing over 1.2 million barrels per day, but the closure of key oil fields caused production to drop to less than 450,000 barrels per day.
On Thursday, the Libyan Parliament-designate government, led by Prime Minister Osama Hammad, lifted the state of force majeure on all oil fields, ports, and facilities, allowing for the resumption of normal oil production and exports.
This decision comes as part of efforts to support recent developments by the House of Representatives and the High Council of State, which resulted in the appointment of a new governor for the Central Bank of Libya and his deputy.
Hammad explained that the force majeure was previously declared as a precautionary measure to safeguard against potential consequences following attempts to seize the Central Bank by unauthorized individuals.
