Libya’s oil sector is facing renewed scrutiny after former Prime Minister Fathi Bashagha raised concerns over what he described as “opaque deals” affecting the country’s most vital economic resource and weakening the Libyan dinar.
In remarks addressing Libya’s political and economic trajectory, Bashagha said U.S. engagement in Libya intensified following the 2011 uprising but declined significantly after the killing of U.S. Ambassador Christopher Stevens in Benghazi. Since then, he noted, Washington has largely limited its role to supporting United Nations-led efforts aimed at fostering political dialogue and national reconciliation.
Bashagha explained that these efforts were initially intended to help establish a unified political framework and strengthen the independence and transparency of key state institutions, particularly the Central Bank of Libya and the National Oil Corporation. These institutions are widely seen as pillars of Libya’s fragile economy and essential to stabilizing the country’s financial system.
Growing Concerns Over Libya Oil Sector Management
However, Bashagha warned that recent developments signal a troubling shift. He claimed that international and domestic efforts have increasingly been replaced by “personal deals” within Libya’s oil sector, raising questions about governance, accountability, and the equitable distribution of national wealth.
According to Bashagha, these alleged arrangements have primarily benefited a limited group of individuals, both inside and outside Libya, while ordinary citizens bear the consequences. He argued that the Libyan dinar has lost part of its purchasing power as a direct result of mismanagement and lack of transparency.
Economic Impact on Libyan Citizens
Bashagha further stated that the National Oil Corporation has suffered from declining asset value, mounting debts, and an inability to significantly boost production levels despite global demand for energy. He emphasized that Libya, which holds Africa’s largest proven oil reserves, remains unable to fully capitalize on the ongoing global energy crisis due to internal divisions and governance challenges.
He added that had Libya received consistent international support to rebuild its institutions, the country could have progressed toward national elections and institutional unification, particularly in the oil and energy sectors.
Calls for Reform and Transparency
The former prime minister concluded by stressing the urgent need for transparency, institutional reform, and unified governance to safeguard Libya’s oil wealth and restore economic stability. He warned that without corrective measures, the gap between Libya’s economic potential and its current reality will continue to widen.
