Libya's Sharara Oilfield Hit with Pipeline Shutdown

Libya's Sharara oilfield is facing a force majeure risk after an armed group shut down a crude oil pipeline, cutting production by around 200,000 barrels per day. According to Libyan political researcher Ahmed Orabi, the field's output has fallen to between 100,000 and 105,000 bpd, compared with its production capacity of nearly 300,000 bpd.

Located in southwestern Libya, Sharara is one of the country's largest oilfields. Its output has been repeatedly disrupted in recent years by protests, political disputes, and technical problems.

The pipeline shutdown could further threaten the continuity of production at the field and potentially lead to a force majeure declaration, Orabi warned. The US dollar is trading at around 9.5 Libyan dinars on the parallel market, compared with an official rate of approximately 6.33 dinars, he noted.

The National Oil Corporation (NOC) Chairman Massoud Suleman initially said Sharara was operating normally, but later told Reuters that the field had experienced a partial reduction in production without providing a specific explanation for the decline.