Sharara Largest Libyan Oil Field Resumes Output

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Sharara Largest Libyan Oil Field Resumes Output

(Bloomberg) — Libya’s biggest oilfield is gradually resuming production after a five-month shutdown as regional powers push to end the country’s civil war.

The restart of the Sharara field in the southwest comes after a valve on a pipeline running to the port of Zawiya was opened on Friday, according to Ali El-Zeeb, the commander of the petroleum-facilities guards aligned with Libya’s internationally recognized government. Sharara was producing around 300,000 barrels a day before it shut in mid-January amid an offensive by Khalifa Haftar, who leads a rival military force based in the country’s east.

The field’s resumption follows setbacks in recent weeks for Haftar’s forces. They’ve lost strongholds in western Libya after battling for more than a year to seize the capital, Tripoli, from the United Nations-backed government of Fayez al-Sarraj. Haftar accepted an Egyptian-sponsored cease-fire over the weekend.

His supporters have blockaded major oil fields and ports since January, cutting output in the North African nation from as much as 1.2 million barrels a day to just 90,000 barrels. Libya holds Africa’s largest proven crude reserves, and the collapse in its production has had the inadvertent effect of helping the OPEC+ alliance prop up oil prices following a rout in March and April.

Sharara is run as a joint venture between Libya’s National Oil Corp. and Total SA, Repsol SA, OMV AG, and Equinor ASA.

The cease-fire and an initiative to permanently end hostilities were announced Saturday at a ceremony in Cairo that Haftar, Egyptian President Abdel Fattah El-Sisi, and Libyan parliament speaker Aguileh Saleh all attended. It’s not clear whether the Tripoli government will accept the cease-fire now they have the upper hand on the battlefield.