Libya’s Sharara oil field output drops sharply after pipeline shutdown

Libya’s Sharara oil field has experienced a significant decrease in production, falling to approximately 127,000 barrels per day after an armed group shut down a pipeline leading to the Zawiya export terminal. This disruption has forced most of the field’s output to be redirected to the Mellitah port. The National Oil Corporation (NOC) has warned that a continued shutdown could completely halt production and disrupt oil transport and exports, potentially affecting Libya’s crude supply flow and the Zawiya refinery system. The impact of this development is being closely monitored in oil markets, with concerns about supply disruptions potentially influencing global oil prices. The reduction in output from one of Libya’s largest oil fields, which normally has a capacity of around 300,000 barrels per day, raises the possibility of tighter global oil supply conditions. This scenario is reflected in market pricing, which is supportive of a YES outcome in markets predicting a new all-time high for crude oil prices. Recent activity suggests that market participants are factoring in the possibility of further geopolitical instability affecting oil supply. While the likelihood of crude oil re...