THE surreal nature of Libya’s politics, with its two prime ministers and two parliaments claiming the right to rule from opposite ends of the country, is encapsulated in the gleaming glass building that houses Libya’s National Oil Corporation (NOC) in the capital, Tripoli. Here Mashallah Zwai, the oil minister appointed by a self-declared government in Tripoli (which the world does not recognise) says he is in charge and that he is working amicably with his rival, Mustafa Sanalla, the NOC chairman and the de-facto oil minister of the internationally supported government, based in the eastern town of Baida.
With the largest oil reserves in Africa, it is little surprise that Libya’s state-run petroleum industry is one of the prizes in a power struggle that many fear could tip into all-out civil war. But despite the crisis, oil-production levels are rising. Some 800,000 barrels flow per day, around half of the amount pumped in summer 2013, before protests and blockades across the oil belt drove production as low as 215,000 b/d. All sides have an interest in maintaining output, given that oil revenues form the pillar of Libya’s economy. Proceeds from exports are channelled first into a state-owned bank overseas, then transferred to the Central Bank, which issues salaries to 1.7m public employees on both sides of the conflict.
An oil engineer, Mashallah Zwai was installed in the NOC by Omar al-Hassi, who heads administration formed in the wake of a weeks-long battle for control of Tripoli. It was won by an alliance including Islamists, led by militiamen from the town of Misrata. In Baida, some 1,000km (621 miles) to the east, sits the internationally recognised prime minister. Abdullah al-Thinni, who vows he will return to Tripoli whenever militiamen loyal to him “liberate” the city. While fighters broadly aligned with Mr Thinni’s government hold sway over most of the oil-producing regions, particularly in the east, the militias backing Mr Hassi control Tripoli, home to the NOC and the Central Bank, which holds billions in accumulated oil revenues.
Awkwardly, Libya holds the rotating presidency of the OPEC oil cartel. Who will represent Libya at an OPEC meeting this month in Vienna to discuss the decline in oil prices? Nobody knows. But at least both sides of the Libyan conflict agree on one thing: cheaper oil is a serious problem.