Commerzbank commodity strategist Carsten Fritsch reports that Libya is preparing to boost its oil output even further.
Libya free to raise production outside OPEC+ limits
Libya’s oil minister has outlined plans to lift crude production from the current 1.4 million barrels per day (bpd) to 1.6 million bpd next year and 1.8 million bpd in the following year—levels not seen since before the 2011 fall of the Gaddafi regime.
After years of conflict and political fragmentation, the investment climate in Libya is showing signs of improvement. A new licensing round for 22 exploration and development areas—the first in over 17 years—has already drawn interest from 40 companies, according to the National Oil Corporation’s head.
Unlike most members of OPEC+, Libya is exempt from the group’s production agreements. That means it can ramp up output regardless of any collective cuts agreed by the wider cartel. While OPEC+ is currently trimming output itself, Libya’s special status could come under scrutiny if the group decides on additional cuts in the future.
