U.S. Energy Information Administration – EIA

August 12, 2022

Libya’s crude oil production averaged nearly 1.2 million barrels per day (bpd) in 2021. In late December 2021, armed militants shut down about 0.4 million bpd of production of crude oil. In April 2022, protesters across the country began blockading several major ports and oil fields in Libya, causing production to plummet to around 0.5 million b/d by July 2022. According to our Libya Analysis NoteLibya’s crude oil production has fluctuated continuously due to armed conflict and political instability since the first Libyan civil war, which began in 2011.

The 2014 elections in Libya led to a divided government with two major parties opposing power in different parts of the country. The internationally recognized Government of National Accord (GNA) governs the western region and the Libyan National Army (LNA) governs the eastern region.

The GNA, LNA and separate local militias used oil exports as political leverage and disrupted Libya’s oil production between 2014 and 2020. After the GNA and LNA signed a ceasefire and lifted restrictions on oil production and exports in October 2020, preliminary estimates of real GDP growth increased by 70% for 2021. Crude oil export revenue is a significant part of the Libyan economy. In 2021, oil revenues accounted for around 98% of the Libyan government’s total revenues, according to the Central Bank of Libya.

Real GDP growth fell by 31% in 2020 due to political disputes between factions in the eastern and western regions; oil export port blockades and pipeline closures; and to a lesser extent, the economic downturn during the global COVID-19 pandemic, according to a World Bank report.

At the end of 2021, Libya held the largest proven oil reserves in Africa, at 48 billion barrels, or 39% of the continent’s total reserves. Libya is ranked among the top 10 countries for proven oil reserves, according to Oil and Gas Journal.

Despite Libya’s large oil reserves, political conflicts and militia attacks on energy infrastructure have limited capital investment in the country’s oil and natural gas sectors. These challenges have also limited the exploration and development of its reserves since 2011. Although Libya is an OPEC member, it is exempt from production cuts under the April 2020 OPEC+ agreement due to Libya’s unstable political situation and limited oil production.

Main contributors: Kimberly Peterson, Candace Dunn

Source link


Comments are closed.