Libya's NOC warns eastern gov't not to use Qatar spat for 'illegal oil exports'

TRIPOLI: Libya's National Oil Corporation (NOC) on Tuesday warned authorities based in the east of the country not to use a rift between several Arab states and Qatar "as a pretext for exporting oil illegally".

The statement came after authorities in eastern Libya threatened to block operations by Glencore, in which Qatar Holding owns a stake and which has a contract with the NOC to lift oil from the eastern port of Marsa al-Hariga.

Any such move would put at risk a partial recovery in Libyan oil output, which recently rose above 800,000 barrels per day (bpd) for the first time since 2014.

Libya has been split for three years between competing governments and armed factions based in Tripoli and the east.

Factions based in the east have repeatedly tried to sell oil independently through an NOC office in Benghazi. They have been prevented from doing so by UN Security Council resolutions that recognise the NOC in Tripoli as the sole legitimate oil exporter.

Some groups have also blockaded ports and other oil facilities.

Despite past threats from eastern officials to disrupt production, Khalifa Haftar's Libyan National Army (LNA), which is aligned with the eastern government and parliament, has kept major ports open in recent months for the Tripoli NOC.

NOC Chairman Mustafa Sanalla said he had warned the head of the eastern government, Abdullah al-Thinni, against any new port blockades.

"We respect the Libyan National Army General Command for its responsible opposition to port blockades," Sanalla wrote, according to the NOC statement. "I hope you will take notice of their wise position on this matter."

He said contracts signed by the head of the NOC Benghazi branch Naji al-Maghrabi "were with companies NOC would not accept as counterparties, and could cost Libya billions of dollars in lost revenue if they were ever implemented". The statement did not give details of the contracts.

OPEC on Tuesday said a long-awaited rebalancing of the global oil market was under way at a "slower pace" and reported that its own output in May jumped due to gains in nations exempt from a pact to reduce supply.

In a monthly report, the Organization of the Petroleum Exporting Countries said its own output rose by 336,000 barrels per day (bpd) in May to 32.14 million bpd led by Nigeria and Libya, two members exempt from the supply reduction deal.