Libyan oil output recovers to nearly a million barrels per day

(Bloomberg) --Libya’s oil production is rising gradually after a blockade of its western fields ended and ports in the east re-opened, according to the OPEC member’s energy minister.

Output is 963,000 barrels a day, Mohammed Oun said in a response to questions from Bloomberg on Thursday.

Production has fluctuated significantly since mid-December, when militias forced western fields, including Libya’s biggest of Sharara, to close down as part of a dispute over pay and politics. The sector was further hit when a major pipeline was shut for repairs early this month, and then again when bad weather caused at least four eastern ports to close.

Libya’s daily output, which averaged 1.2 million barrels a day last year, fell to as low as 700,000 barrels. Sharara was pumping 200,000 barrels as of Wednesday, according to a separate person familiar with the matter. That’s roughly 60% of its capacity.

Exports may still be hindered, at least in the next few days, by ports in the west being closed, also because of rough weather.

Oil traders are watching Libya closely. The country sits on Africa’s biggest reserves and any disruptions would further tighten the market at a time when demand’s recovering from the depth of the coronavirus pandemic. West Texas Intermediate crude is already up 10% this year to almost $83 a barrel, extending last year’s 55% surge.

The volatility in Libya’s production comes as political tensions rise. A presidential election was meant to be held on Dec. 24, but was delayed as disputes over the eligibility of candidates threaten to sow fresh turmoil in a country that’s been in conflict or civil war for much of the past decade.