TRIPOLI: The United Nations Support Mission in Libya (UNSMIL) has said it held dialogs in Tripoli in order to help resolve a central bank crisis that sparked a blockade of oil production and threatens the worst crisis in years for the major energy exporter.
The stalemate was triggered when Western factions moved last month to remove governor Sadiq Al-Kabir and replace him with a rival board, forcing Eastern factions to close all oil production. In its statement, the UN officials said the consultations were ended with ‘significant’ understanding and the two parties agreed to submit a draft agreement to their respective chambers for assessment, with the goal of finalizing and inking the deal on Tuesday.
The statement said that the representatives from Libya’s House of Representatives and High Council of State and the Presidential Council attended the talks in Tripoli. Libya’s central bank (CBL) is the single lawful repository for oil revenues and it pays state salaries across Libya. According to Reuters news agency, if the fight for control is prolonged, all state salaries, transfers between banks and letters of credit required for imports will become impossible, freezing up Libya’s international trade and the economy.
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Eastern factions, including the House of Representatives parliament led by speaker Aguila Saleh and the Libyan National Army under Khalifa Haftar, oppose the Tripoli-based Presidency Council’s bid to remove CBL governor Al-Kabir.
The eastern side’s oil blockade will slowly starve the CBL of new funds, as well as dropping condensate available for power plants, meaning long power blackouts may soon return.
As a result of the current crisis, the state-owned National Oil Corporation (NOC) stated total production had plunged to just 591,000 bpd by August 28 from around 959,000 bpd on August 26, amounting to losses of over $120 million over the three days. Production was at 1.28 million bpd on July 20, NOC stated.
