Will Libya’s Crude Oil Production Drop in the Coming Months?

Libya’s crude oil production 

According to Reuters, Libya’s crude oil production fell 20,000 bpd (barrels per day) to 960,000 bpd in May compared to April. However, Libya’s production is near a five-year high. The increase in Libya’s production coincided with the rise in Brent and US oil prices.

Brent and WTI oil prices have risen ~151% and ~150%, respectively, since February 11, 2016. The iShares Global Energy ETF (IXC) has risen ~56% since February 11, 2016. IXC aims to follow an index of global equities in the energy sector.

Will Libya’s Crude Oil Production Drop in the Coming Months?

ONEOK (OKE), Ecopetrol (EC), Petróleo Brasileiro (PBR), and Encana (ECA.TO) account for ~2.3% of IXC’s holdings. These stocks have risen ~294%, 279%, ~254%, and 234%, respectively, since February 11, 2016. They were the top gainers in IXC’s holdings during the same period.

Supply outages in Libya 

On May 22, crude oil production at Libya’s Arabian Gulf Oil Company fell to ~145,000 bpd from ~260,000 bpd, according to Bloomberg. Production dropped due to the hot weather in Libya. Production could start again once the weather normalizes. Supply outages usually have a positive effect on crude oil prices.

Libya and crude oil supply cuts

Libya has been exempt from ongoing supply cuts due to economic issues, militant attacks on oil infrastructure, and unexpected supply outages. The country’s crude oil production averaged 384,000 bpd in 2016 and 817,000 bpd in 2017.


Libya aims to increase its crude oil production in 2018 despite ongoing supply cuts mandated by OPEC. Libya’s National Oil Corporation plans to increase the country’s production to more than 2 MMbpd (million barrels per day) by 2022. The National Oil Corporation is the country’s state-owned oil company. An increase in Libya’s oil production could weigh on crude oil prices, but an unexpected supply outage could benefit oil prices.

Read Will US Crude Fall below $60? for the latest updates on crude oil.