Libya's oil production has fallen to 230,000 barrels a day from 570,000
bpd due to the closure of the el-Sharara field following protests,
state-owned National Oil Corp (NOC) said. The crisis has already cost the country an estimated 10 billion in losses. "The country's oil production has fallen to 230,000 bpd after the
closure on Thursday evening of the oilfield at el-Sharara," which has an
output of 330,000 bpd, NOC spokesman Mohamed al-Harairi said on Sunday. The recent decline is the latest blow to the oil-rich North
African nation, where the oil sector accounts for 70 percent of GDP, 95
percent of state revenues and as much as 98 percent of exports. Ever since the revolt against Gaddafi the nation's oil industry has often been targeted by rebels in order to undermine the state's authority while gaining international attention. I am curious to see how the fellow Arab League nation's will react to this especially OPEC since Libya is a member nation. Could we see a rise in gas prices?
http://www.aljazeera.com/news/africa/2014/02/libya-oil-output-dives-after-key-field-shut-2014223153123479374.html
This is a perfect example of why a stovepipe economy is so dangerous. A country can't just rely on one sector of the economy to support the entire economy of the nation. We will have to keep an eye out for this problem happening in other oil-rich countries, as many of them are dependent solely on oil also.
ReplyDeleteThis is a major issue in many North African and other Arab countries. Their economies are so dependent on oil but their infrastructures are so unstable that something like a revolt, rebellion or even a strike can greatly effect their economy. This can also greatly effect all of the other OPEC countries and every country that utilizes their oil. Gas prices and travel hinge so directly on these oil exports it may come to the point where OPEC leaders, members or even western countries feel the need to intervene to get the oil exportation under way again.
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