December 4, 2013 / 4:21 PM / 6 years ago

UPDATE 3-Libya hopes to restore full oil output in two weeks

(Adds PM Zeidan, details, background)

By Georgina Prodhan and Ghaith Shennib

VIENNA/TRIPOLI, Dec 4 (Reuters) - Libya hopes on Dec. 10 to reopen all its oil ports blocked by protesters over political and financial demands and resume full production about a week later, Oil Minister Abdelbari al-Arusi said on Wednesday.

A mix of militias, tribesmen and minorities demanding a greater share of Libya’s oil wealth and more political power have shut most oilfields and ports, cutting oil output to 224,000 barrels a day from 1.4 million bpd in July.

Libya is facing turmoil as the government of Prime Minister Ali Zeidan struggles to control dozens of former militias that helped oust Muammar Gaddafi two years ago but have refused to give up their arms.

Zeidan has been unable to end the protests so far but is counting on rising public anger over the blockades drying up the main source for the budget and causing power outages.

One major obstacle is that protesters are not a unified group but rather a regional autonomy movement in the east, civil servants seeking pay, and minorities who want their language recognised. Those demands are hard to meet for a prime minister weakened by political infighting.

Oil Minster Arusi told reporters at an OPEC meeting in Vienna he was “optimistic” that pressure on protesters to allow the resumption of production would see Libyan oil output restored to 1.5 million barrels per day (bpd).

“We have heard good news from the local people that they are going to attend to the situation,” Arusi said. “We don’t have any guarantees.

Asked how soon after Dec. 10 Libya could get production back to normal, the minister said: “From one week to 10 days.”

Zeidan said in Tripoli he was unable to confirm the comments but said when asked whether there was a deal to reopen the ports next week: “There is a set of measures about to be implemented that will lead to that.”


Oil traders and analysts were sceptical output would resume quickly as the government has repeatedly expressed hope months of blockages of its main oil ports and fields would end. Restoring oil output after lengthy disruption would take time.

“This looks wildly optimistic,” VTB Capital oil strategist Andrey Kryuchenkov said. “I can’t see Libya reopening all the ports quickly, and then it would take much longer to get back up to 1.5 million bpd full output.”

The government set a deadline last month which expired without taking any action.

The army at the weekend called on the protesters to let oil exports resume but this was seen as symbolic comment as the new military, still in training, is no match for heavily-armed militias who helped topple Gaddafi.

Last week, the oil workers’ union asked a regional autonomy leader to open Ras Lanuf port, the country’s second-largest.

In the main cities Tripoli and Benghazi power went off, worsening outages which usually start in the late afternoon. Long queues could be seen at petrol stations in Tripoli. (Additional reporting by Christopher Johnson in London and Ghaith Shennib in Tripoli; Writing by Ulf Laessing and OPEC team; Editing by Dale Hudson and Keiron Henderson)

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