Armed Group Shuts Down Pipeline from Libya's Largest Oil Field

An armed group has shut down a pipeline from Libya's largest oil field, El Sharara, which is operated by Akakus Oil Operations. The closure affects a pipeline linking the field to the coastal city of Zawiya, home to one of the country's main export terminals.

The National Oil Corporation (NOC) said that the shutdown has caused a pressure buildup within the crude oil pipeline, leading to a significant reduction in production at the El Sharara field. The field produces approximately 350,000 barrels per day, accounting for roughly a third of Libya's total output.

The NOC warned that if the shutdown continues, they could be 'compelled to declare force majeure', a legal provision that allows suppliers to suspend contractual obligations due to circumstances beyond their control. This would directly reduce state revenues at a time when global oil prices are rising, with prices above $100 a barrel in recent weeks.

Libya has been plagued by violence and instability since the overthrow of Muammar Gaddafi in 2011, and this shutdown highlights the ongoing challenges facing the country's energy sector. El Sharara was previously shut for two years between November 2014 and December 2016 after a pipeline blockade by armed groups.