News / Economy

    Chaotic Libya Struggles to Maintain Oil Output

    FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya. FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.
    x
    FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.
    FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.
    Reuters
    Libya is struggling to keep its oil output stable, let alone increase it, as protests cut crude exports in the sector that supplies 95 percent of state revenue.
     
    In the past year, disgruntled Libyans have protested at oilfields and export ports, clouding initial optimism over a speedy return to output levels of nearly 1.6 million barrels per day (bpd) following the 2011 war that ousted Moammar Gaddafi.
     
    The state National Oil Corporation (NOC) said on its website output had slumped to less than one million bpd following “irresponsible acts by some individuals” who shut down two export terminals and a major oilfield.
     
    “The industry is suffering and this cannot go on as it is,” a senior Libyan oil industry source said. “These kind of problems keep recurring and this is hurting the whole of Libya.”
     
    The new leadership has struggled to impose its authority on a myriad of armed groups who have the real power on the ground in a country awash with weapons left over from the war.
     
    Protesters, usually with social demands, have forced Tripoli to comply with their requests before ending sit-ins or turning valves back on.
     
    In the latest headache for the industry, the operator of the major El Feel field, a joint venture between the NOC and Italy's Eni, halted output as some 50 protesters staged a demonstration, calling for jobs and salaries. El Feel, which lies in Libya's southwestern desert, can pump up to 130,000 bpd.
     
    In the east, protesters forced the shutdown of the Zueitina and Marsa al-Hariga terminals but workers there said on Tuesday operations were resuming after the demonstrators had left the sites. Zueitina has faced numerous disruptions this year.
     
    “If the protesters go to local councils, nobody will listen to them. But if they go to the oilfields or terminals, they have everybody's attention,” a Libyan oil worker said. “This problem keeps happening and the government doesn't know how to cope.”
     
    Costly Disruptions
     
    Without specifying, the NOC said the latest output cuts were costing the country “hundreds of millions of dollars” in lost income.
     
    A prolonged drop in output could be disastrous for state finances, already strained by salary spending which now includes tens of thousands of former rebel fighters from the war.
     
    Last month, a committee overseeing Libya's energy industry within the national assembly, said those who forcefully closed down installations should be held accountable in court.
     
    But with state security forces and courts still weak, enforcing such action remains a mammoth task. A 15,000-strong force guarding oil sites lacks proper training and equipment and its members have at times fought amongst themselves.
     
    “We need a government to make strong decisions and guards to protect oilfields,” Yussef al-Ghariani, of an oil workers' union in the eastern city of Benghazi, said. “Every delay is costly.”
     
    In April, oil flows hit 1.55 million bpd, according to the oil ministry, which has previously said OPEC-member Libya aimed to increase output to 1.7 million bpd from the third quarter.
     
    But with continuous disruptions due to the protests and sometimes technical problems, this target now appears elusive.
     
    “The trend is going in the wrong direction. They are struggling to keep production at 1.3-1.4 [million bpd] whereas they were hoping to be raising it and hitting new peaks,” Richard Mallinson, of consultancy Energy Aspects, said. “The likelihood is only that it will get harder and harder to maintain levels we have seen over the last few months as protests continue and the situation does not improve.”
     
    Foreign oil companies are increasingly unsettled by sporadic violence and oil services firms are not rushing to send workers back to Libya.
     
    “You just don't know where things are going. People who were already worried about coming here will be even more reluctant,” one foreign oil worker said, declining to be named.
     
    With the continuing chaos tainting Libya's image abroad, oil market players are factoring in more disruptions.
     
    “Every time you get news of one situation being resolved, you just wait and expect to hear what is the next field that is being shut or obstruction to a terminal,” Mallinson said.

    You May Like

    US Leaders Who Served in Vietnam War Look Back and Ahead

    In New York Times opinion piece, Secretary of State John Kerry, Senator John McCain and former Senator Bob Kerrey say as US strengthens relations with Vietnam, it is important to remember lessons learned from war

    Who Are US Allies in Fight Against Islamic State?

    There is little but opportunism keeping coalition together analysts warn — SDFs Arab militias are not united even among themselves, frequently squabble and don’t share Kurds' vision for post-Assad Syria

    Learning Foreign Language Helps US Soldiers Bridge Culture Gap

    Effective interaction with local populations part of everyday curriculum at Monterey, California, Defense Language Institute

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Vietnamese-American Youth Optimistic About Obama's Visit to Vietnami
    X
    Elizabeth Lee
    May 22, 2016 6:04 AM
    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video Vietnamese-American Youth Optimistic About Obama's Visit to Vietnam

    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video First-generation, Afghan-American Student Sets Sights on Basketball Glory

    Their parents are immigrants to the United States. They are kids who live between two worlds -- their parents' homeland and the U.S. For many of them, they feel most "American" at school. It can be tricky balancing both worlds. In this report, produced by Beth Mendelson, Arash Arabasadi tells us about one Afghan-American student who seems to be coping -- one shot at a time.
    Video

    Video Newest US Citizens, Writing the Next Great Chapter

    While universities across the United States honor their newest graduates this Friday, many immigrants in downtown Manhattan are celebrating, too. One hundred of them, representing 31 countries across four continents, graduated as U.S. citizens, joining the ranks of 680,000 others every year in New York and cities around the country.
    Video

    Video Vietnam Sees Strong Economic Growth Despite Incomplete Reforms

    Vietnam has transformed its communist economy to become one of the world's fastest-growing nations. While the reforms are incomplete, multinational corporations see a profitable future in Vietnam and have made major investments -- as VOA's Jim Randle reports.
    Video

    Video Qatar Denies World Cup Corruption

    The head of Qatar’s organizing committee for the 2022 World Cup insists his country's bid to host the soccer tournament was completely clean, despite the corruption scandals that have rocked the sport’s governing body, FIFA. Hassan Al-Thawadi also said new laws would offer protection to migrants working on World Cup construction projects. VOA's Henry Ridgwell reports.
    Video

    Video Infrastructure Funding Puts Cambodia on Front Line of International Politics

    When leaders of the world’s seven most developed economies meet in Japan next week, demands for infrastructure investment world wide will be high on the agenda. Japanese Prime Minister Shinzo Abe’s push for “quality infrastructure investment” throughout Asia has been widely viewed as a counter to the rise of Chinese investment flooding into region.
    Video

    Video Democrats Fear Party Unity a Casualty in Clinton-Sanders Battle

    Democratic presidential front-runner Hillary Clinton claimed a narrow victory in Tuesday's Kentucky primary even as rival Bernie Sanders won in Oregon. Tensions between the two campaigns are rising, prompting fears that the party will have a difficult time unifying to face the presumptive Republican nominee, Donald Trump. VOA national correspondent Jim Malone has more from Washington.
    Video

    Video Portrait of a Transgender Marriage: Husband and Wife Navigate New Roles

    As controversy continues in North Carolina over the use of public bathrooms by transgender individuals, personal struggles with gender identity that were once secret are now coming to light. VOA’s Tina Trinh explored the ramifications for one couple as part of trans.formation, a series of stories on transgender issues.
    Video

    Video Amerikan Hero Flips Stereotype of Middle Eastern Character

    An Iranian American comedian is hoping to connect with American audiences through a film that inverts some of Hollywood's stereotypes about Middle Eastern characters. Sama Dizayee reports.
    Video

    Video Budding Young Inventors Tackle City's Problems with 3-D Printing

    Every city has problems, and local officials and politicians are often frustrated by their inability to solve them. But surprising solutions can come from unexpected places. Students in Baltimore. Maryland, took up the challenge to solve problems they identified in their city, and came up with projects and products to make a difference. VOA's June Soh has more on a digital fabrication competition primarily focused on 3-D design and printing. Carol Pearson narrates.

    Special Report

    Adrift The Invisible African Diaspora

    World Currencies

    EUR
    USD
    0.8954
    JPY
    USD
    109.74
    GBP
    USD
    0.6851
    CAD
    USD
    1.3148
    INR
    USD
    67.673

    Rates may not be current.