Libya’s oil production is back above 1 million barrels a day for the first time in two months, thanks to a political standoff getting resolved, Bloomberg reported.
Libya’s eastern government had halted all oil production and exports following a dispute over control of the central bank, which manages billions of dollars in energy revenue.
Libya resumed oil production last Thursday, bringing hundreds of thousands of barrels per day back to global markets after resolving a political standoff.
As of Sunday, Libya was pumping out 1.067 million barrels after the eastern government lifted a blockade on October 3, according to insiders who requested anonymity.
This boost in oil supply comes at a time when the market is already dealing with soft demand, even though OPEC is set to start gradually easing its production cuts later this year.
Despite the increase in supply, oil prices jumped on Monday because traders are worried that the escalating conflict in the Middle East could disrupt global supplies. Brent crude has gone up 11% in the past week, now trading near $80 per barrel.
Libya, typically producing over 1.2 million barrels per day, saw output plummet to less than 450,000 barrels in August after the UN-recognized western government dismissed the central bank governor.
Political disputes often put Libya’s oil production in the middle of the chaos, with different factions fighting for control of the key industry.
Despite a 2020 United Nations-backed ceasefire intended to end hostilities, deep-rooted political divisions between Libya’s east and west have continued to trigger clashes and blockades, often targeting the country’s most valuable asset—its oil.
