EU: Gaddafi no longer controls most oil fields

AFP , Monday 28 Feb 2011

EU officials say there is no reason to impose blockade on oil exports from Libya as oil fields are now under the control of local tribes

Libya
An anti-government rebel walks at the oil terminal of Brega, around 300 km (186.4 miles) southwest of Benghaz (Reuters)

Muammar Gaddafi's regime no longer controls most of Libya's oil and gas fields as they have fallen in the hands of the opposition, the European Union's energy commissioner said Monday.

"There is reason to believe that the majority of the oil and gas fields are no longer under Gaddafi's control," Gunther Oettinger told a news conference following a regular meeting of EU energy ministers.

Oettinger dismissed the idea of imposing a blockade on oil exports from Libya because local tribes or regional groups now control the installations opposed to the Gaddafi government.

"We would potentially be punishing the wrong people," he said.

The EU agreed earlier slapped an asset freeze and a travel ban on Gaddafi and 25 members of his family and inner circle, and banned the supply of weapons, ammunition and related material to Tripoli.

The 27-nation bloc finalised the measures after the UN Security Council agreed at the weekend to impose similar sanctions on the Gaddafi regime in a bid to stem the deadly repression of an opposition movement.

Libyan gas represents less than three per cent of the entire EU market while oil accounts for less than 10 per cent.

Oil production had ground to a halt in Libya in recent days but was apparent set "to get going again," Oettinger said.

The energy commissioner said the EU had enough reserves to make up for the shortfall in Libyan supplies and that the OPEC oil cartel as well as Russia were willing to help fill the gap.

Libya, a member of the Organisation of the Petroleum Exporting Countries, is the fourth biggest oil producer in Africa.

It produces 1.69 million barrels of oil per day and exports 1.49 million barrels, with 85 per cent of it going to Europe. Italy is its main client for oil and gas.

Oettinger said companies affected by the drop in Libya production would be compensated.

World oil prices have climbed amid a wave of revolts spreading across North African and the Middle East in the past month, from Tunisia and Egypt all the way to Bahrain, Yemen and Oman.

Saudi Arabia, OPEC's largest producer of oil, said it was ready to compensate for the supply losses from Libya.

While Libya's production does not weigh on world prices, any delivery problems in other parts of the Arab world could have an influence, Oettinger said.

"If other countries were to have delivery problems, then a peak could be reached in the coming days," he said.

Search Keywords:
Short link: