Libya Threatens Force Majeure as Oil Guards Shut Fields

Libya's National Oil Corporation (NOC) has threatened to declare force majeure after security forces protecting the nation's oil infrastructure shut a pipeline valve, halting production at two major oilfields and a pumping station. The Hamada and Tahara oilfields, along with a pumping station, are currently offline, and the Petroleum Facilities Guard, which closed the valve on the main Hamada-Zawiya crude pipeline, has indicated that partial production cuts could affect several additional fields including Wafa, Al-Khamsa, and El Feel.

The Petroleum Facilities Guard is demanding financial and administrative transfer from Libya's defense ministry to the NOC, and has threatened a full shutdown if its demands are not met. The NOC has stated it will declare force majeure if the valve is not reopened or if similar shutdowns occur at other fields.

Libya has faced this situation before, with political groups, armed factions, and workers repeatedly using oilfields, pipelines, and terminals as leverage since the 2011 uprising that ousted Muammar Gaddafi. The current disruption comes at a time when Libya is aiming to significantly increase production, with the NOC targeting 1.6 million barrels per day by the end of 2026 and 2 million bpd by the early 2030s. To achieve these goals, the NOC estimates that $36 billion to $40 billion in foreign investment will be required.

International companies, including Repsol, Turkish Petroleum, Eni, QatarEnergy, MOL, BP, Shell, Exxon, and Chevron, have recently returned to Libya following the first major licensing round in 17 years. The Libyan government allocated $2 billion in its 2026 budget to support production plans, but the vulnerability of fields capable of producing more oil remains high, as whoever controls the valve can still impose significant disruptions.