Libya’s National Oil Corporation has declared a force majeure on the country’s largest oil field, Sharara amid protests from local communities.
The force majeure entered into effect on Sunday, the NOC said on X, adding that it was negotiating with the protesters in a bid to resume the oil flow to the Zawya export terminal.
Protests at the Sharara field began last week, with protesters demanding greater government involvement in the southern region of Fezzan, including more job creation and more investments in the economic development of the region.
Sharara, which can produce up to 300,000 barrels of crude daily is a magnet for protesters and various political and paramilitary factions that want to make a point or prompt government action.
"The loss of confidence in the continuity of supplying the global market with Libyan oil will result in Libyan oil remaining unmarketed," the Libyan oil ministry said in a statement last week, as cited by Reuters.
"Closing and reopening the production requires maintenance operations and the treatment of technical problems, as well as a lot of effort, a long time, and a high cost to be borne by the Libyan state treasury”, the statement also said.
Force majeure declarations for the field have not been a rarity over the past few years as Libya’s civil war continues, albeit at a smaller scale than immediately after the killing of former ruler Muammar Ghaddafi.
Oil accounts for almost all of Libya’s export revenues, which makes it the country’s most important industry but also a target for various groups. Now there is worry that the protesters could also shut down the 60,000-bpd El Feel field, which is hear Sharara.
Oil prices have yet to reflect that worry, however. Earlier today oil was down following the news that Saudi Aramco was cutting oil prices for all buyers.
By Charles Kennedy for Oilprice.com
More Top Reads From Oilprice.com:
- Maersk Reroutes Ships Away from Red Sea after Latest Attack
- APA Acquires Callon Petroleum in $4.5 Billion Permian Deal
- Iran Withholds Oil Deliveries As It Seeks Higher Prices from China
