The political crisis in Libya intensifies with the flight of Seddiq el-Kebir, Governor of the Central Bank of Libya (BCL), after receiving direct threats from armed groups.
In an interview with the Financial Times, el-Kebir describes a climate of terror where militias harass BCL employees, even kidnapping their children and relatives to force them back to work. This comes as Libya remains divided between the UN-backed government in Tripoli, led by Abdelhamid Dbeibah, and a parallel administration in the east, allied to Field Marshal Khalifa Haftar.
In response to el-Kebir’s departure, the Tripoli authorities set up a “handover commission” to take control of the BCL offices in Tripoli.
In response, the administration in the East, which controls almost 90% of the country’s oil production, announces a suspension of exports and production.
This blockade caused daily oil production to fall to around 600,000 barrels a day, according to the National Oil Corporation (NOC), compared with 1.18 million barrels in July.
Economic repercussions of the oil blockade
The oil blockade in Libya is drastically reducing national production, directly affecting state revenues and the regional oil market.
The NOC reports that the shutdowns have led to a 63% drop in the country’s total production, resulting in significant revenue losses for a country whose economy is heavily dependent on the oil sector.
The Sarir, Messla and Nafoura fields, which play a key role in the country’s oil supply, have received orders for partial resumption of production.
This decision, issued by the Arabian Gulf Oil Company, reflects an attempt at stabilization, but the climate remains tense.
The port of Hariga, essential for Libyan crude exports, has halted operations due to the shortage of crude oil.
Meanwhile, Abdel Fattah Ghaffar, appointed interim governor of the BCL, announced that banking operations were resuming after disruptions caused by the outgoing administration.
He assured the International Monetary Fund (IMF) and the World Bank that the BCL would comply with all applicable national and international legislation, in an attempt to restore the confidence of international investors.
Reactions from the international community and ongoing tensions
BCL’s critical situation is attracting the attention of the international community.
The United Nations Mission in Libya (UNMIL) and the United States warn of the risk of economic collapse if the crisis is not resolved quickly.
The European delegation in Libya expresses its “serious concern” and calls for a “negotiated solution”, while insisting on the lifting of the “state of force majeure on all oil fields” to ensure economic stability.
Tensions within the BCL reflect wider divisions between Libya’s political factions.
Tripoli accuses el-Kebir of favoring the interests of the East and the Haftar clan in the distribution of oil revenues.
For their part, supporters of the East see Tripoli’s takeover of the BCL as an illegal maneuver, violating the agreements negotiated under UN auspices.
Consequences for the Mediterranean market and regional strategies
The absence of Libyan crude on the Mediterranean market is forcing refineries to look for alternatives, notably Caspian crudes such as CPC Blend from Kazakhstan and Azeri BTC.
Traders report that prices for Caspian crudes are rising, with premiums for CPC Blend tightening to less than 30 cents per barrel over Dated Brent, compared with a discount of nearly $2 at the start of the month.
Azeri BTC prices are crossing the $4/barrel mark due to increased demand, exacerbated by production disruptions in Libya.
CPC Blend exports are expected to reach around 1.3 million barrels per day in September, but a reduction is anticipated in October due to maintenance work at the Kashagan oil field, which could exacerbate tensions on the Mediterranean light crude market.
Challenges for BCL governance and the Libyan economy
Control of the BCL remains a central issue in the struggle for power in Libya.
The oil blockade imposed from the east has already halved export volumes, putting pressure on an already fragile economy.
The restoration of operations by interim governor Ghaffar is seen as an attempt to maintain some stability, but the challenges remain manifold, not least with accusations of manipulation and favoritism in the management of oil revenues.
International calls for a negotiated resolution underline the urgency of a coordinated approach to restoring financial stability.
However, deep political divisions and conflicting interests complicate the implementation of a shared governance plan.
Export recovery and transparent management of public finances remain priorities to avoid economic collapse.
