Libya is pumping the most oil in four years after a deal with Wintershall AG enabled at least two fields to resume production, adding to the challenge that OPEC and allied producers face in trying to pare global crude inventories.
The North African country is currently producing about 900,000 barrels a day, according to a person with direct knowledge of the matter, who asked not to be identified for lack of authority to speak to the media. Output has risen on the resumption of fields developed with Wintershall and from a boost at Sharara, Libya’s biggest deposit, which is pumping 270,000 barrels a day, the person said Monday.
The politically divided country is pumping at its highest level since June 2013, when production reached 1.13 million barrels a day, data compiled by Bloomberg show. The increase adds to the challenge that the Organization of Petroleum Exporting Countries and other major producers face after agreeing in May to extend their output-cuts deal to counter a supply glut and slippage in prices. Libya, like Nigeria, is exempted from the cuts deal.
The National Oil Corp. and Germany-based Wintershall agreed last week to restart production in some areas, allowing for crude to flow again from the Agkhara deposit, the NOC said in a June 15 statement. Libya’s Sarah oil field also resumed output last week as a result of the deal, another person familiar with the situation said at the time. An earlier dispute with Wintershall had halted 160,000 barrels a day in output, the NOC said on May 31 in a statement.
Libya produced about 700,000 barrels a day at the end of April, Jadalla Alaokali, an NOC board member, said then. The country plans to pump 1 million barrels a day by the end of July, the company’s chairman, Mustafa Sanalla, said last week.
Libya is restoring output and exports after descending into lawlessness following a 2011 revolt against former leader Moammar Al Qaddafi. The country, with Africa’s largest crude reserves, was pumping about 1.6 million barrels a day before the uprising.