Big Oil

If anyone wondered just how serious the turmoil was in Libya, this weeks attacks on its oil fields have likely erased those doubts, and left Western oil companies with big investments in the country wondering whether one of their more promising prospects in Africa is destined for a long and bitter war.
Before dawn on Wednesday in the countrys central coastal region, groups of armed fighters claiming allegiance to the Islamic State, or ISIS, stormed two oil facilities, each jointly operated with Libyan and Western oil companies: Mabruk, a joint venture with Total; and Bahi, partly operated by a U.S. consortium consisting of Marathon Oil, Hess, and Conoco Philips.
On Wednesday, Ibrahim Dabbashi, Libyas ambassador to the U.N., pleaded with the Security Council to lift the international arms embargo against his country, warning that unless Libya receives fresh weaponry, ISIS will continue to use the perilous power vacuum to expand its operations.
This is where these groups thrive, Ghellal says.With militia groups conducting regular incursions against oil terminals and pipelines over the past several months, Libya, a key Opec member, has seen its oil production plummet from around 1.6 million barrels a day in 2010, to around 750,000 barrels a day last November, down again to 325,000 barrels a day in January, and up to around 500,000 barrels or so this month, according to the NOCs estimates.
To gauge how risky non-oil investments in Libya are, consider the sobering experience of APR Energy, a Jacksonville Florida company specializing in fast-track power supply; the company trades on the London Stock Exchange, and until recently APR regarded Libya as a solid market for expansion.

How Oil is Threatening to Deepen the Divide

A power struggle for control of Libyas oil is threatening to deepen splits in the country and undermine the fragile authority of the UN-backed Libyan Government of National Accord, the GNA. The battle has forced the politically neutral chairman of the Libyan National Oil Corporation to warn the GNA that it has overstepped its authority both by closing the oil ministry and by trying to take over some of the NOCs role.
Sanalla had been acting as de facto oil minister; Serrajs closure of the department appears to bring part of the NOC under political control a move that risks opening the door further to corruption and revenues being siphoned off for private or political use. The NOC is one of the few functioning national institutions that has worked across a complex political divide including Serraj and the forces of Field-Marshal General Haftar, the leader of the self-styled Libyan National Army in the east.
Sanalla has been slowly increasing Libyan oil production, and persuading foreign oil companies from Russia, Italy and the UK to have the confidence that Libya is a country in which it will be safe to invest.



Libya is still is a deep state of turmoil. Their oil industry may be causing even more turmoil. It seems that even terror groups, such as ISIS, know what the power of oil is. In its simplest terms, oil provides money that funds not only the country of Libya, but also the militant groups vying for control. Attacks on oil fields in Libya, who is a key member of OPEC, have seen substantial decreases in their oil production. The Libyan ambassador to the UN has both warned and asked for help from the UN. He thinks that without new and fresh weapons, he wants the UN to end the arms embargo, ISIS and other militant groups will just gain more and more control. This would be a blow to a country who is trying to regain control over itself. Obviously, the militant groups are radicals. They want to gain control by imposing their will on the internationally recognized government of Libya, and they are willing to do whatever it takes. Some of the other players though, I would say are Political Liberals. They want help from MNCs and foreign governments, namely the UN, in order to act more like a “State” and secure economic stability.