Oil prices surged on Monday as a military blockade in Libya led to oilfields being shut down exports halted.
The National Oil Corporation (NOC), Libya’s state energy firm said the Libyan National Army has instructed its subsidiaries to halt exports from Brega, Ras Lanuf, Hariga, Zueitina and Sidra ports.
The embargo means daily production of 800,000 barrels per day, worth US$55 million a day will be affected, NOC said in a statement.
Brent crude rose to as much as $65.68 per barrel intraday, its highest since Jan. 8.
The latest blockage follows a long-running conflict in Libya, where two rival factions have claimed the right to rule the country for more than five years.
On Sunday, NOC said two big oilfields in the southwest had begun shutting down after forces loyal to the Libyan National Army closed a pipeline. NOC said it condemned the blockade, adding that “shutting down oil exports and production will have far-reaching and predictable consequences.”
“If the fields are shut, the production loss will be immediate. We have limited available storage at our main ports. If they are closed, we will need to reduce production immediately, and to shut down entirely when available storage is filled. That could be in as little as five days,” said NOC chairman Eng. Mustafa Sanalla.