Libya’s eastern-based administration, led by Khalifa Haftar, has taken a drastic step by halting oil production and exports, citing escalating tensions with the UN-recognised government in Tripoli. The decision, announced on Monday, throws the country’s already fragile political and economic landscape into further turmoil.
The Benghazi-based administration declared a “force majeure” – a legal clause allowing parties to be excused from contractual obligations due to unforeseen circumstances – blaming the move on “repeated attacks” on the Central Bank in Tripoli. They accused “outlaw groups” of attempting to seize control of the bank, which manages Libya’s vast oil resources and state budget.
The incident follows a series of concerning events, including the abduction of the Central Bank’s head of information technology on August 18th, which led to the temporary suspension of all bank operations. While the IT chief was released on Monday and operations resumed, the situation has sparked anxieties about the bank’s security and its role in managing Libya’s vital oil industry.
Local media reports indicate that armed men besieged the Central Bank a week prior, demanding the resignation of its governor, Seddik al-Kabir. Kabir faced criticism over his handling of oil resources and the state budget. The eastern-based administration claims that authorities in Tripoli have now taken control of the Central Bank and announced Kabir’s resignation. Video footage broadcast by local media shows members of the Presidential Council, aligned with Prime Minister Abdulhamid Dbeibah, inside the bank’s headquarters.
Libya has been struggling to recover from the devastating conflict that erupted after the 2011 NATO-backed uprising which toppled dictator Muammar Gaddafi. The country remains divided between the UN-recognised government in Tripoli and the rival administration in the east. Most of Libya’s oil fields are located in regions controlled by Haftar, making the oil industry a crucial factor in the country’s power dynamics.
This latest development further exacerbates the existing tensions and underscores the complex challenges facing Libya’s future. The suspension of oil production will undoubtedly have a significant impact on the country’s economy and could further strain relations between the competing factions. It remains to be seen how this situation will unfold and whether it will lead to a further escalation of the conflict.
