Oil exports from Libya, Africa's third-largest oil producer behind fellow OPEC members Angola and Nigeria, could be off the market for months due to damage on oil infrastructure in the country and international sanctions, according to a report by the International Energy Agency (IEA).
While estimates vary, IEA says Libya produced an average of 1.3 million barrels of oil per day last year and that those exports have dwindled significantly has fighting has escalated in the eastern part of the country, which is home to many of Libya's oil assets.
Libya's Arabian Gulf Oil Company is currently producing 400,000 barrels per day, but that oil may not be exported for the rest of this month, Reuters reported. The IEA said problems in Libya could escalate into a civil war or that a rejuvenated regime led by dictator Moammar Gadhafi could exert more control over the country's oil industry.
Most of the loss of Libyan crude exports has been filled by an increase in oil production from Saudi Arabia, the Wall Street Journal reported, citing the IEA. Nearly every international oil major that does business in Libya has halted those operations and ceased trading with the country due to economic sanctions. Libya is home to Africa's largest oil reserves.