Rebels in Libya surrendered the control of two captured oil ports back to the government, which potentially enables the member of OPEC to triple its crude exports during this month through an increase of more than 180,000 barrels per day. On the news, Brent futures fell.
The Executive Office of Barqa gave back the Hariga and Zueitina oil terminals last night said a spokesperson for the group that is seeking self-rule in the region referred to as Cyrenaica.
The group reached an agreement on Sunday with government officials that also says the rebels would relinquish two other ports that are under their control. Ras Lanuf and Es Sider will be released back to the Libyan government between two and four weeks. The agreement was confirmed by the Libyan government on its website.
With the largest oil reserves in Africa, Libya’s production of oil dropped by over 1 million barrels daily the past year due to protests halting production in ports and oil fields.
Last week, futures for Brent crude fell by 1.3% and could fall even more if exports are to resume, said one chief analyst in the industry.
Another analyst said that the state owned oil company in Libya, National Oil Corp, could start exports at once since the terminals were handed over in good shape.
The port of Hariga can handle up to 110,000 barrels daily while the port of Zueitina can handle over 70,000 barrels. Es Sider is the largest Libyan oil terminal, with a loading capacity daily of more than 340,000 barrels, while Ras Lanuf can handle 240,000 per day.
Brent crude for settlement in May dropped by $1.32 per barrel or over 1.2% on the London futures of ICE to $105.39 per barrel.
Libya currently is exporting 85,000 barrels of crude per day from Bouri and Jurf two offshore fields, which have not been affected by protests that disrupted oil output on the mainland.
Last month Libya produced over 250,000 barrels daily, compared to more than 1.6 million barrels per day prior to the rebellion in 2011 that ousted longtime leader Muammar Qaddafi.