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Libya Oil Crescent - Recent Developments October 7 2016
Libya Oil Crescent - Recent Developments October 7 2016
www.whisperingbell.com /blog/libya/libya-oil-crescent-recent-developments
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The NOC announced that it is capable of raising production to 600,000 bpd within a few weeks and to 950,000 bpd by the
end of the year, from around 290,000 bpd pumped prior to LNA taking control of the Oil Crescent. Early signs of the NOC
activities support its statement of increasing oil production, having resumed meetings with the oil majors of Libya and
announced the reactivation of production of oil fields including the fields of Amal, Nafoura, Hamada, and Majid field over the
recent short period.
Libyas oil production has suffered since the 2011 revolution. Following a rapid recovery in 2012 to pre-revolution levels of
1.6million bpd, internal political conflicts led to Jathrans forces closing the ports, claiming that oil was being sold without
meters to measure the amount pumped to the ports. This resulted in years of disruptions to oil production and a drop in
state income, which depends almost entirely on oil revenue. Libya has been running a state budget deficit since 2014, and
with its finances weathering quickly, the country is in urgent need of stability and agreement between political parties to
stabilize its finances again.
Analysis:
Whispering Bell assesses the timing of the LNAs advance on the Oil Crescent Region is critical. As the fight against IS in
Sirte could be nearing an end, there were fears that those forces could continue eastwards to support Jathrans PFG. This
would have forced the LNA to be the aggressors against forces aligned with the internationally recognized GNA. Removing
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Jathran from the equation and controlling the oil facilities provided General Haftar with greater negotiating power in
initiating localized military control in the east of the country, including the most critical oil facilities.
Both Prime Minister Sarraj and UN Special Envoy to Libya Martin Kobler quickly expressed their interest to meet and open
a dialog with General Haftar, who has yet to officially respond. On Sept 16, a meeting was held in Cairo involving
discussions between Prime Minister Sarraj and HoR President Ageela Saleh, suggesting the formation of an Armed Forces
Supreme Council, which would include General Haftar as one of the members. Prime Minister Sarraj also stated General
Haftar should be represented in a new more inclusive government.
However, an opposite reaction to the LNA actions in the Oil Crescent was witnessed from the High State Council to that of
Prime Minister Sarraj and UN Special Envoy Martin Kobler. Speaking at a press conference at the High State Council
offices in Tripoli, Council President Abdulrahman Swehli called on Libyans to resist the military coup attempt by General
Haftar, announcing that the Council will take charge of running the country until the HoR gives a vote of confidence to the
GNA. On Sept 25, the High State Council announced that it plans to appoint top military and civilian positions, including the
heads of the armed forces and the governor of Central Bank of Libya (CBL).
Current political landscape
With Jathrans PFG forces losing control of the coastal area from Zueitina to Al-Sidra, and the agreement between the LNA
and the tribes in the central Libya, the LNA and HoR have been able to expand their territorial dominance further west to the
edge of Sirte. The GNA forces have expanded further east over the past month, since the start of the campaign to regain
control of Sirte from the Islamic State (IS). IS have lost territory from Abu Grain and most of the city of Sirte, leaving their
current control to a couple remaining neighborhoods on the east side of the city.
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