Libya has lifted majeure on its last major oilfield, declaring a formal end to an eight-month blockade that choked off exports from North Africa’s leading Opec producer.


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State-owned National Oil Corporation (NOC) ordered the resumption of production from the Al Feel field as part of a fast-track drive to restore production of one million barrels per day next month.

Blow to Opec+ plans

A quick rebound in Libyan output has rattled oil markets in a blow to efforts by Opec and allies such as Russia to prop up prices through deep output curbs at a time of low demand exacerbated by the Covid-19 pandemic.

Libya is not bound by any Opec quota restrictions because of a long-running civil war that has largely prevented it from producing at capacity in the past decade.

"[NOC] declares the ending of the blockades in the entire Libyan fields and ports as of [26 October] and instructions have been given to the operator, Mellitah Oil & Gas to resume production in Al Feel (The Elephant) oilfield and the gradual return of Mellitah crude to its normal level in the next few days," the Tripoli-based company said.

Production from Al Feel is expected to climb to around 70,000 bpd by the end of the week.

Libya’s output has risen rapidly over the past six weeks after rebel commander General Khalifa Haftar ended a blockade of ports and oil facilities his army imposed in January.

Political talks

His self-declared Libyan National Army, which controls the core of Libya’s oil industry in the east of the vast desert country, agreed a permanent truce with the United Nations-recognised government of Prime Minister Fayez al Sarraj on Friday.

The two sides are set to meet in Tunisia next month to appoint a unity government.

Recovery in oil and gas production is expected to be fast as production and export facilities have escaped large-scale destruction in the conflict.

Output has soared to around 560,000 bpd from 100,000 bpd in early September. Sharara, the country’s biggest field, reopened around two weeks ago, while the last two oil export terminals that were still closed — Ras Lanuf and Es Sider — restarted on Friday.

NOC is hoping to resume full pre-blockade output of 1.2 million bpd by the end of the year as infrastructure is repaired and budget constraints are lifted.

'Serious harsh times' for oil market

Russian President Vladimir Putin said last week he has not ruled out a delay in the alliance’s scheduled output hike at the start of next year.

Saudi Energy Minister Prince Abdulaziz bin Salman said on Monday the oil market is going through “serious harsh times".

Libyan warring sides agreed to a complete, countrywide and permanent agreement last week with immediate effect.

Stephanie Williams, the UN acting special envoy who was chairwoman of the most recent talks, said the truce called for frontline forces to return to their bases and for the withdrawal of all foreign forces and mercenaries within three months, a process that would be monitored by the UN.

However, the country has a long history of failed peace initiatives. The role of the foreign sponsors that have driven the long-running war will be key to the success of any lasting ceasefire.

Haftar has the backing of Egypt, France, the United Arab Emirates and Russian mercenaries ,while the Tripoli-based administration relies mainly on Turkey and the rich Persian Gulf state of Qatar for military and financial help.

Williams said the agreement will be sent immediately to the UN Security Council, stressing the critical importance of international backing.

Libya has been in chaos since a NATO-backed 2011 uprising that overthrew former dictator Muammar Gaddafi.