Libya is a member of the Organization of the Petroleum Exporting Countries, the holder of Africa’s largest proved oil reserves, and an important contributor to the global supply of light, sweet crude oil.
“Libya joined the Organization of the Petroleum Exporting Countries (OPEC) in 1962, a year after it began to produce oil. Libya now holds the largest amount of proved crude oil reserves in Africa, the fourth largest amount of proved natural gas reserves on the continent, and it is an important contributor to the global supply of light, sweet (low sulfur) crude oil, which Libya mostly exports to European markets. Libya’s hydrocarbon production and exports have been substantially affected by civil unrest over the past few years. The civil war in 2011 resulted in the fall of Col. Mu’ammar al-Qadhafi’s regime and the gradual consolidation of control over most parts of the country by the Transitional National Council (TNC) and affiliated rebel militias. Libya’s hydrocarbon exports suffered a near-total disruption during the civil war, and the minimal and sporadic production that did occur was mostly consumed domestically. In response to the loss of Libya’s oil supplies in the summer of 2011 the International Energy Agency (IEA) coordinated a release of 60 million barrels of oil from the emergency stocks of its member countries through the Libya Collective Action – the first such release since Hurricane Katrina in 2005. Libya’s oil production recovered in 2012, but it still remained lower than levels prior to the civil war. After the civil war ended, labor-related protests occurred sporadically at various oil fields and installations. Protests at oil fields escalated in June 2013, affecting output at some of Libya’s major oil fields. In July and August, protests at key oil loading ports in the central and eastern regions, by workers and guards that were hired to protect the facilities, crippled the oil sector and led to the near-halt in production from the oil fields linked to ports after most storage tanks became full. Production at two major oil fields in the west were shut down in late August after the Zintan militia closed pipelines linking the fields to loading ports but output in the west resumed in mid-September.Libya’s economy is heavily dependent on hydrocarbons. According to the International Monetary Fund (IMF), oil and natural gas account for nearly 96% of total government revenue and 98% of export revenue in 2012. Roughly 79% of Libya’s export revenue comes from crude oil exports, which brought in around $4 billion per month of net revenues in 2012. EIA’s OPEC Revenues Fact Sheet has net oil export revenues also at $4 billion per month from January to June 2013. During the 2011 civil war, the drop in oil and natural gas production led to an economic collapse, and real GDP contracted by 62% for the year.”