Conflict threatens Libyan oil sector’s long-term stability
On 27 December, Manager of Libya-Analysis LLC Rhiannon Smith was featured in Petroleum Economics exposéwith an on the current situation of the Libyan oil sector. For Smith, despite the worsening conflict, on the surface, Libya’s oil sector appears to be weathering the storm. However, she notes that:
The NOC remains chronically underfunded and the ongoing conflict has diverted further monies away from its budget. In addition, since the conflict started, the GNA has suspended much needed economic reforms—meaning Libya’s economy is likely to remain under strain, even if the conflict ends soon. As a result, the NOC will likely struggle to fund all the maintenance works required to keep production steady in 2020, let alone begin new expansion projects. As long as the conflict continues, and even if a ceasefire is agreed, it is likely that meaningful reengagement and investment from IOCs will be delayed until longer-term stability looks more assured.
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