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Libya's warring factions have agreed a permanent ceasefire to end more than 18 months of conflict, the UN said today, raising the possibility of a sustained revival in the country's oil output.
Representatives of the insurgent Libyan National Army (LNA) and the Tripoli-based, UN-backed Government of National Accord (GNA), which have been fighting since April last year, today signed a truce that will see both parties demilitarise, particularly in the Sirte and Jufra regions where armed forces accrued over the summer.
"The parties determined that the ceasefire will take effect immediately as of today," UN acting special representative for Libya Stephanie Williams said today in Geneva.
The agreement calls for all mercenaries and foreign fighters to withdraw from Libya within the next 90 days. Both sides have received external support during the 18-month war, the LNA from Russia, Egypt and the UAE, and the GNA from Turkey and Qatar, and the presence of non-Libyan forces at the eastern ports of Ras Lanuf and Es Sider has been an obstacle in the revival of the country's oil sector.
Libya's oil operations were largely reduced to offshore production from the Farwah terminal and Al Jurf field from the start of the year until September because of blockades by forces affiliated with the LNA, including tribal factions, the Petroleum Facilities Guard that previously secured state-owned NOC assets, Russian paramilitary group Wagner and Syrian and Sudanese mercenaries. Williams said today that foreign intervention is broader still, and could comprise mercenary contingents from up to nine countries.
Since a mid-September agreement between the LNA and GNA to end the blockades, NOC has lifted force majeure restrictions from terminals and fields it deems secure. A source in the country said that production climbed to 525,000 b/d earlier this week.
Argus estimates that Libyan production averaged around 180,000 b/d in the first nine months of this year. It was 1.1mn b/d in December, before the start of blockades. A sustained revival could cause difficulties for the Opec+ group's plan to ease its production cuts in January. The situation in Libya, which is not bound by the output agreement, was a key discussion point at recent meetings of the Opec+ Joint Technical Committee and Joint Ministerial Monitoring Committee.
At the heart of Libya's conflict were disagreements about the management and distribution of oil and gas revenues, which the LNA said were misused by Tripoli-based central bank CBL. In late-July, the UN said that auditing firm Deloitte began carrying out a financial review of the CBL and its parallel al-Bayda organisation. Williams said today that this will take six months, and said that sovereign fund Libyan Investment Authority (LIA) will also be audited.
Today's truce follows inter-Libyan talks of the 5+5 Joint Military Commission — which includes five senior officials from each side — and comes after countrywide demonstrations over corruption, power outages and the ceaseless turmoil that has ravaged the north African state since the 2011 deposition of Muammar Gaddafi. The 5+5 commission will convene towards the end of the first week of November in Tunis to discuss further steps, Williams said.
