Sharara start a shot in arm to Libya crude output

LIBYA'S oil production may rise to 600,000 barrels a day, its highest since August, after production resumed at the Sharara field yesterday.

Oil from Sharara, a field able to produce 330,000 barrels a day, began flowing yesterday morning and is now going into storage tanks at the Zawiya terminal, Libya's oil ministry head of measurement and inspection Ibrahim Al Awami said.

The field, located near Ubari in the country's south, had been closed for about 90 days because of protests.

Oil output from Libya, once North Africa's biggest producer, fell from 1.6 million barrels in July 2012 to 210,000 barrels a day last month, the lowest since late Libyan leader Muammar Qaddafi was killed in a 2011 revolution, according to data compiled by Bloomberg. Protesters and armed groups have shut oil fields and four of nine export terminals.

UK crude prices fell 4.7 percent last week, the biggest weekly fall since June 21, as Sharara protesters announced they would allow production to resume and the Messla oil field restarted.

An increase in Libyan exports would be needed for prices to fall further, according to Navitas Resources managing director Tom James.

"On the eastern side, the ports have not opened up yet," James said.

"Until those ports start getting freed up, there won't be a further negative impact to prices."

loader