Newswire – Libya’s state oil firm declared force majeure on key field El-Feel amid a widening shutdown of production triggered by a power struggle in the OPEC member.
The force majeure, a legal clause that allows companies to suspend contractual obligations due to circumstances beyond their control, came from National Oil Corp. after authorities in the east stopped all output and exports in a dispute with rivals over control of the central bank.
The country’s production has more than halved since then. El-Feel was pumping about 70,000 bpd.
The eastern and western governments are in a standoff over the bank, the custodian of billions of dollars of energy revenue. Eastern authorities ordered the freeze after the internationally recognized government in the capital, Tripoli, replaced Governor Sadiq Al-Kabir.
The nation was pumping about 1 MMbpd before the halt order, with the vast majority of that coming from the east. Daily production in the past week plunged to about 450,000 bpd.
Oil prices in London jumped above $80 a bbl when the production halt was announced last week. They’ve slipped since on concerns about global demand.
Al-Kabir, who’s feuding with Tripoli-based Prime Minister Abdul Hamid Dbeibah and has allies in the east, rejected the order to step down, prompting western authorities to take over the bank’s headquarters.
*Salma El Wardany & Hatem Mohareb – Bloomberg
