28 April 2022; MEMO: The United States called on Libyan leaders, on Wednesday, to work "immediately" to end the closure of oil installations. It considered the suspension of production as a hasty measure that harms the Libyans and undermines international trust toward Libya as an actor in the global economy.
The US Embassy in Tripoli said in a press statement that Washington is "deeply concerned about the continued oil closure, which deprives the Libyans of significant revenues, contributes to increasing prices, and could lead to power outages, water supply problems and fuel shortages."
"Libyan leaders must realise that the closure affects Libyans throughout the country; it has repercussions on the global economy, and they have to end the oil closure immediately," the Embassy added.
Ten days ago, the state-run National Oil Corporation (NOC) declared the "force majeure" state, and suspended operations in two important oil ports in the east of the country, while six oil fields continue to be closed in the south and east of the country.
The closure caused a loss of 600,000 barrels, equivalent to half of the daily production, while the average production in Libya, which has the largest reserves in Africa, amounted to 1.2 million barrels per day.
The Embassy also reminded the Libyan leaders of the various Security Council resolutions that protect the oil establishment, reaffirming its commitment to work with the Libyan leaders on "a mechanism that may grant the Libyan people trust that oil revenues are distributed for the benefit of the people."
The United States confirmed that it provides advice on "the creation of a temporary Libyan financial mechanism with a wide support to handle how revenues are spent, in the absence of an agreed-upon national budget."
In the conclusion of its statement, the Embassy stressed: "the necessity that Libya's wealth go to serve the Libyans throughout the country, and no outside party is entitled to decide the fate of the Libyan resources."
The closures happened after calls by groups from eastern Libya, responsible for the oil embargo, to transfer power to the new Prime Minister, Fathi Bashagha, who was appointed by Parliament and supported by Field Marshal Khalifa Haftar, who de facto controls several important oil installations there.
Libya is suffering from an escalating political crisis with a conflict between two governments: one is headed by the former Minister of Interior, Fathi Bashagha, which was granted confidence by Parliament in March, and the second has emerged from a political agreement sponsored by the United Nations more than a year ago and is headed by Abdul Hamid Dbeibeh, who refuses to hand over power, except through elections.
The closures of oil fields and ports have been repeated over the past years due to labour protests, security threats or even political disputes. These closures have caused losses of more than $100 billion, according to the Central Bank of Libya.
