Libya’s National Oil Corporation is resuming operations at the Zueitina oil terminal after the unit was shut down last month because of the ongoing political turmoil in the country.
The oil company declared "temporary lifting of the force majeure” at the terminal on Sunday to start loading tankers with crude oil to reduce stock and free up storage capacity, it said in a statement on its website.
Force majeure refers to an unforeseen set of circumstances preventing a party from fulfilling a contract.
“With the efforts of the … people of this country and in regular and continuous communication with all parties, the [Zueitina] oil terminal has temporarily resumed work, to load two tankers and allow for enough space to store the displaced volume of crude oil,” the company said.
The company halted exports from the terminal last month after a group of people entered the unit and stopped employees from working. It also gave a warning about an “imminent environmental disaster” at the terminal if the stocks were not reduced to free up storage capacity.
The opening of the terminal is expected to add downward pressure on oil prices, which continued to slide on demand concerns due to movement restrictions in China, the world’s second-largest economy and the top importer of oil.
Brent, the benchmark for two thirds of the world's oil, was up slightly by 0.05 per cent at $107.91 a barrel at 11.42am UAE time on Monday. West Texas Intermediate, the gauge that tracks US crude, was trading 0.03 per cent lower at $104.66 per barrel.
Libya, an Opec member, produces about 1.2 million barrels of oil a day and is exempt from the Opec+ production deal because of security concerns.
The North African country’s output has suffered because of the closure of several oil production units in recent times amid political turmoil in the country.
Apart from Zueitina oil terminal, Libya also declared force majeure at Brega oil port as well as Al Sharara oilfield and El Feel oilfield, also known as the Elephant field.
“The instructions were given to the operator … to start shipping the crude to the tankers which [are] already nearby, and thus the NOC announces a temporary lifting of the force majeure from the Zueitina oil terminal, with the hope that the crisis will be sorted out soon,” the company said.
Libya, which exports mostly sweet oil, has had much of its production remain offline during the civil war that erupted between factions after the downfall of former Libya leader Muammar Qaddafi in 2011.
The country has had two competing governments since March and these rival administrations could herald a return to division and instability, the UN said earlier this year.
