Libya's National Oil Corporation reimposed force majeure on all oil exports from the North African country, a day after it declared it would start loading shipments.
"The renewed blockade demonstrates the urgent need for moves to improve financial transparency to be accompanied by reform of security at oil installations,” said NOC chairman Mustafa Sanalla.
Force majeure refers to an unforeseen set of circumstances preventing a party from fulfilling a contract.
The NOC, which loaded the tanker Kriti Bastion at Es Sider port on Saturday has since halted further loadings from across its facilities.
Forces allied with Field Marshall Khalifa Haftar released a statement on Sunday setting down conditions for the reopening of exports from the North African producer. Among the conditions are equitable distribution of oil revenue across the country.
Anwar Gargash, the UAE's minister of state for foreign affairs also said that safeguards must be in place to ensure oil revenues do not fuel further conflict.
"The UAE, alongside its partners, wants to see a return to oil production in Libya as soon as possible," he said in a tweet on Sunday.
The six-month blockade has cost the country $6.5 billion (Dh23.8bn) in lost production.
Much of Libya's production remained offline during the civil war that erupted between rival factions after the downfall of Muammar Qaddafi in 2011.
Production, which stood at about 1.75 million barrels per day, fell by 850,000 bpd in the years that followed as protests and blockades prevented the export of crude oil through the country’s key ports.
In an interview with The National in 2018, Mr Sanalla said the country, whose oil is largely sweet and among the cheapest in northern Africa, needed $60bn to develop its upstream and downstream sectors amid plans to raise its refining capacity to one million bpd.
The possibility of Libyan oil returning to the markets comes at a time when Opec+, the alliance led by Saudi Arabia and Russia is undertaking a historic production cut. Current output restrictions of 9.7m bpd are set to be eased in a tapered manner this month. The group has pledged to maintain production curbs until April 2022.
A joint ministerial monitoring committee of the alliance is set to convene on Wednesday to discuss producers' compliance with the pact.
Following news of increased output, oil prices fell during the opening session on Monday. Brent, the international crude benchmark, was down 0.83 per cent at $42.88 per barrel, while West Texas Intermediate, the US gauge, was down 1.01 per cent at $40.14 per barrel at 11.44am UAE time.