Libya says oil shutdown losses close to $2.6 billion

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CAIRO (AP) — Economic fallout continues from a protracted blockade of Libya’s vital oil fields and ports, with losses close to $2.6 billion, the national oil corporation announced Tuesday, intensifying the pressure on a U.N.-supported government in the capital.

Powerful tribes loyal to Libya’s eastern-based forces seized large export terminals and choked off major pipelines in January, aiming to starve the Tripoli-based government of crucial revenues.

The eastern-based forces, led by military commander Khalifa Hifter, launched an offensive in April to capture Tripoli, clashing with an array of militias loosely allied with the U.N.-supported government. The fighting for Tripoli has ground down to a stalemate in recent months.

The National Oil Corporation, which dominates Libya’s critical oil industry, said Tuesday the losses as of Monday were close to $2.6 billion since Jan. 17.

Libya’s oil and gas production have been consistently down since the shutdown of oil facilities, with daily production dropping to 123,240 barrels a day on Monday, the NOC said.

The corporation warned of “potential fuel shortage in the coming days,” and complained of lack of funding to import sufficient fuel.

Oil, the lifeline of Libya’s economy, has long been a key factor in the civil war, as rival authorities jostle for control of oil fields and state revenue.

Libya has the ninth largest known oil reserves in the world and the biggest oil reserves in Africa.

The closure of the oil facilities was seen as part of Hifter’s efforts to capture Tripoli and punish adversaries there for sealing security and maritime agreements with Turkey, opening doors for military support from Ankara.

The shutdowns also come against the backdrop of a crumbling cease-fire mediated by Russia and Turkey, which support opposing sides of the conflict in the North African country.

The U.N. envoy for Libya Ghassan Salame announced his resignation on Monday, throwing U.N.-led efforts to end the conflict into further chaos.

Salame, 69, said he was stepping down on health grounds after he tried to “unify the Libyans, curb foreign interference and protect the country’s integrity” since his appointment in July 2017.

Libya has been in turmoil since 2011, when a civil war toppled longtime dictator Moammar Gadhafi, who was later killed.

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