Libya’s oil output, exports to resume after deal on central bank head

A month-long oil shutdown in Libya looks set to end within days after rival political factions agreed to appoint a new central bank governor Sept. 26, while crude loadings looked to have resumed at a key export terminal.

Naji Essa has been nominated to lead the key institution, which takes receipt of Libya’s lifeblood oil revenues, on an interim basis, officials from Libya’s eastern and western governments said at a signing ceremony organized by the UN mission in Libya, which brokered the talks.

Current deputy governor Marai al-Basari will remain in his post and a new central bank board will be appointed within two weeks, the officials said.

The deal still needs to be rubber-stamped by the eastern House of Representatives, but is expected to conclude an oil shutdown, which started on Aug. 26 after the western government in Tripoli moved to oust Siddiq al-Kabir as governor.

As much as 750,000 b/d of Libyan crude was taken offline by the eastern faction, dominated by warlord Khalifa Haftar, whose troops have blockaded oil fields in the past. Key export terminals, such as the Zawiya and Mellitah were also closed, according to loading schedules obtained by S&P Global Commodity Insights.

Sources said oil production could resume in earnest in the next 14 days thanks to the agreement, which should also bring to an end force majeure declarations at the 300,000 b/d Sharara and 80,000 b/d El-Feel fields.

Libya boasts Africa’s largest oil and gas reserves but has seen little peace and stability since the toppling of Moammar Qadhafi in 2011. Feuds between influential actors like Haftar, National Oil Company chairman Farhat Bengdara and prime minister Abdul Hamid al-Dbeiba can directly impact crude production.

The country pumped 1.15 million b/d of crude in July, prior to the crisis, according to the Platts OPEC Survey from S&P Global Commodity Insights. But output had fallen to 562,000 b/d by Sept. 23, according to a confidential production report obtained by Commodity Insights.

The House of Representatives, the country’s eastern-based parliament, will have one week to formally approve the appointment of Essa, a former advisor to Kabir and director of the Banking and Monetary Supervision Department.

Kabir fled to Istanbul as the crisis deepened in late August, fearing violent attacks from armed militia in Tripoli.

Export bounce
The breakthrough agreement came amid indications of an export bounce, with force majeure at the country’s western Mellitah terminal lifted as of Sept. 26, according to a loading schedule seen by Commodity Insights.

Shipments at the nearby Zawiya export hub remained suspended, however.

The two western terminals have been among the last to resume oil exports even as activity picked up in the country’s east, returning light sweet Es Sider crude alongside Brega, Sarir and other grades to the Mediterranean market.

Loading schedules showed that 600,000 barrels of Mellitah crude supplied by NOC are expected to load Sept 26-28, implying resumed supplies to the terminal.

Mellitah is operated by a joint venture that includes the NOC and Italian energy giant Eni. Representatives from NOC and Eni did not immediately respond to requests for comment.

Four separate cargoes were unable to load while the terminal was under force majeure, while data from S&P Global Commodities at Sea showed no loadings since Aug. 30.

Total Libyan crude oil exports hit 485,700 b/d in the week to Sept. 22, according to CAS data, up from a low of 171,400 b/d, but well below the 1 million b/d average prior to the disruption.

Exports of Es Sider crude, the country’s main export grade, totalled 85,700 b/d, compared with the 2024 average of over 250,000 b/d.

Increased flows could put additional pressure on the light sweet crude complex as refiners halt operations for seasonal maintenance and Mediterranean producers have curbed crude runs in response to falling margins.

Platts, a part of Commodity Insights, assessed FOB Libya ES Sider crude at a differential of 70 cents/b to Dated Brent on Sept. 25, up from a discount of around 1 cent/b the previous month but down from a peak premium of 1/b Sept. 9 as shipments have resumed.
Source: Platts