Libya’s National Oil Corporation on Sunday announced the resumption of crude production from the Sharara oilfield in the country’s south.
The crude production facility, which was shut down on January 7 following protests by area residents demanding better infrastructure and economic opportunities, produces 300,000 barrels of oil a day.
It accounts for a quarter of the North African country’s total production of 1.2 million bpd.
"NOC declares lifting of force majeure and resumption of full production from Sharara", the state-run energy company said in a Facebook post.
Sharara is operated by a joint venture between NOC, Equinor, OMV, Repsol and France’s TotalEnergies.
Sharara field is vital to the future plans of NOC, which in October said it planned to increase its crude production to 2 million bpd over the next three to five years.
However, the latest closure of production facilities at Sharara would not bode well for the confidence of international oil companies that have been returning to Libya following years of political instability.
Last week, the country's oil minister said that the shutdown of the key oilfield could potentially impact the nation's gross domestic product and undermine Libya's reputation as a reliable energy supplier.
“We believed the country had achieved stability, and customers had confidence in receiving consistent oil quantities. Losing customers is a real risk, jeopardising the future for everyone,” Mohamed Oun told reporters on the sidelines of an event in Tripoli at the time.
Hydrocarbons make up about 95 per cent of Libya's exports and account for nearly 95 per cent of government revenue.
The return of 300,000-bpd of Libyan crude to the market will likely impact oil prices when trading begins on Monday.
Brent, the benchmark for two thirds of the world’s oil, settled 0.68 per cent lower at $78.56 a barrel on Friday.
West Texas Intermediate, the gauge that tracks US crude, closed down 0.90 per cent at $73.41 a barrel.
