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First oil in two years leaves Libya’s Ras Lanouf port for Italy

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Benghazi, Libya | AFP |

An oil tanker left the Libyan port of Ras Lanouf for Italy on Tuesday, an official said, the first shipment since fighting erupted over control of the “oil crescent” two years ago.

Oil is war-ravaged Libya’s key asset, and rival administrations have been vying for control of its oil wealth and territory since the 2011 uprising that overthrew dictator Moamer Kadhafi and plunged the country into chaos.

“The Maltese-flagged vessel Seadelta has just left Ras Lanouf port with 776,000 barrels of oil, going to Italy. This is the first shipment of oil from Ras Lanouf port since November 2014,” said Omran el-Fitouri, oil exports coordinator at the port.

The shipment is also the first to leave any of the four ports in the area since they were seized by military strongman Khalifa Haftar last week.

His forces handed the ports over to the National Oil Corporation (NOC), which said that crude exports would resume “immediately” from Ras Lanuf and another of the four, Zuwaytina.

The NOC says it is loyal to the Tripoli-based Government of National Accord (GNA), but also to the rival parliament based in the east which supports Haftar’s forces and has refused to give the GNA its vote of confidence.

On Sunday, fighters loyal to the UN-backed unity government launched an attack aimed at retaking the key eastern oil ports, but were repelled by Haftar’s forces.

The fighting forced the Maltese-flagged tanker to turn back out to sea for safety, abandoning plans to load crude oil at Ras Lanouf.

Other ports in the crescent have been operating intermittently in recent years, but if the breakthrough at Ras Lanouf — one of Libya’s biggest ports — is sustained it could lend support to the status quo after the tussle for control.

 

Markets sceptical 

The latest shipment could also help ease a cash crisis for Libya’s strapped banks which are in dire need of hard currency.

Libya has Africa’s largest oil reserves estimated at 48 billion barrels, but the country’s production and exports have slumped dramatically during the years of crisis.

Oil prices rose Monday after the tanker was turned back, as concerns grew over supply.

But prices edged up again in Asian trade Wednesday and the Seadelta’s successful departure is unlikely to have a dramatic effect given the cloudy picture for Libyan production, said Jeffrey Halley, senior market analyst at OANDA.

“The amount of oil coming out of Libya is fairly limited so it won’t have a material impact on crude prices today,” Halley told AFP. “The fighting means that we don’t know how sustained their output can be.”

Last week, US envoy to Libya Jonathan Winer told AFP it was essential that money from the resumption of oil exports went only to the UN-backed government.

“Oil needs to be produced throughout the country to generate the revenues necessary to pay for salaries for the Libyan people to have the government be able to function,” Winer said.

The Government of National Accord is the centrepiece of UN efforts to restore stability in Libya and forge a central authority capable of tackling the twin scourges of the Islamic State group and people-trafficking across the Mediterranean.

But it has struggled to impose its authority amid opposition from the rival administration which is backed by Haftar, who sees himself as Libya’s saviour after driving jihadists out of most of the second city Benghazi.

 

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