First oil in two years leaves key Libyan port

Benghazi (Libya) (AFP) - An oil tanker left a key Libyan port early Wednesday with the first crude shipment from the terminal since fighting halted exports there in 2014, an official said.

Oil is war-ravaged Libya's key asset, and rival administrations have been vying for control of territory and oil resources since the 2011 uprising that overthrew dictator Moamer Kadhafi.

"The Maltese-flagged vessel Seadelta has just left Ras Lanuf port with 776,000 barrels of oil, going to Italy. This is the first shipment of oil from Ras Lanuf port since November 2014," said Omran el-Fitouri, oil exports coordinator at the port.

The shipment is the first to leave any of the four ports along Libya's eastern "oil crescent" since they were seized by military strongman Khalifa Haftar last week.

His forces handed management of the ports to the National Oil Corporation (NOC), which said that crude exports would resume "immediately" from Ras Lanuf and another of the ports, Zuwaytina.

Map of Libya's Gulf of Sirte region, locating oil ports and facilities

The NOC says it is loyal to Libya's Tripoli-based Government of National Accord (GNA) but also to the parliament based in the east which supports Haftar's forces and has refused to give the GNA its vote of confidence.

On Sunday, fighters loyal to the UN-backed unity government launched an attack aimed at retaking the key eastern oil ports, but were repelled by Haftar's forces.

The fighting had forced the Maltese-flagged Seadelta to turn back out to sea for safety.

Other ports in the crescent have been operating intermittently in recent years, but major exports from Ras Lanuf could pump welcome revenue into the central bank's coffers.

Fitouri told AFP on Wednesday that a second tanker, Maltese-flagged Syra, was preparing to deliver a further 580,000 barrels from Ras Lanuf to Tarragona in Spain.

Markets sceptical

The latest shipment could also help ease a cash crisis for Libya's strapped banks which are in dire need of hard currency.

A tug boat approaches the Malta-flageed Seadelta oil tanker off the coast of Libya's eastern Ras Lanuf port, on September 19, 2016

Libya has Africa's largest oil reserves estimated at 48 billion barrels, but the country's production and exports have slumped dramatically during the years of crisis.

Libya pumped around 1.6 million barrels of crude a day before Kadhafi's overthrow, but the ensuing chaos slammed production, which fell as low as 290,000 in recent months, according to the NOC.

Oil prices rose on world markets on Monday after the tanker was turned back. Prices edged up again on Wednesday.

Jeffrey Halley, senior market analyst at OANDA, said the Seadelta's successful departure was unlikely to have a dramatic effect given the murky picture for Libyan production.

"The amount of oil coming out of Libya is fairly limited so it won't have a material impact on crude prices today," Halley told AFP. "The fighting means that we don't know how sustained their output can be."

Last week, US envoy to Libya Jonathan Winer told AFP it was essential that money from the resumption of oil exports went only to the UN-backed government.

"Oil needs to be produced throughout the country to generate the revenues necessary to pay for salaries for the Libyan people to have the government be able to function," Winer said.

The GNA is the centrepiece of UN efforts to restore stability in Libya and forge a central authority capable of tackling the twin scourges of the Islamic State group and people-trafficking across the Mediterranean.

But it has struggled to impose its authority amid opposition from a parallel administration based in the east backed by Haftar.