Conflict over Libyan oil imports intensifies between Central Bank, President of Oil Corporation

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Wed, 02 Dec 2020 - 10:57 GMT

FILE PHOTO: An oil pump jack can be seen in Cisco, Texas, August 23, 2015. Mike Stone/File Photo - REUTERS

FILE PHOTO: An oil pump jack can be seen in Cisco, Texas, August 23, 2015. Mike Stone/File Photo - REUTERS

CAIRO -2 December 2020: Libya has been recently witnessing a massive escalation between the National Oil Corporation and the Libyan Central Bank in Tripoli in the conflict over Libyan oil imports, where both sides have been throwing mutual accusations of squandering billions of dollars from the people's money in the previous years.



This is in addition to the refusal of the National Oil Corporation in Tripoli to transfer oil imports to the Central Bank of Libya, which is accused of financing armed militias in the cities of the Western Region, where President of the Oil Corporation Mustafa Sanallah, criticized the bank’s actions in his statements, describing them as a lack of transparency. 

 

Sanalla hinted during his statements that certain individuals squandered hundreds of millions from the money of the Libyan people, describing them as "dinosaurs and monsters," and accusing the Central Bank in Tripoli of providing fake money that never reached the citizens or the oil institution.



Sanalla touched on the difference between the exchange rates of the dollar against the Libyan dinar in the official market and the informal market, and directly accused the governor of the Central Bank of "exchanging the dollar for 1.40 Libyan dinars for some people, then reselling it to citizens at prices ranging between 6 and 10 dinars."



Sanalla indicated that the corporation has kept oil money in the Libyan Foreign Bank until transparency is achieved and the exchange rate is unified, denouncing the existence of four exchange rates in Libya, which confirms the existence of failed monetary policies.



Conflicts between the Libyan sovereign institutions over Libyan oil imports appeared openly after the Libyan Central Bank was accused in a letter addressed to the National Oil Corporation of hiding part of the oil imports and not including them in the Libyan state budget. 

 

This comes as a first response to the latter’s adherence to the decision to withhold revenues from the Central Bank to ensure that the bank's transactions are transparent.  The corporation decided to freeze the revenues in the Libyan Foreign Bank until a recent executive authority is formed.



According to local Libyan media, Governor of the Central Bank in Tripoli, Al-Siddiq Al-Kabeer, sent a letter to the Chairman of the Board of Directors of the National Corporation, where Kabeer confirmed that the Oil Corporation had not supplied about $3.2 billion of revenues to the public treasury, expressing  surprise that the oil institution withheld revenues from the state accounts at the Central Bank.



In his message, Kabeer said that oil revenues supplied to the Central Bank of Libya from October to mid-November amounted to about $15 million only, despite the corporation’s announcement that production reached 1.2 million barrels per day, indicating the state’s need for foreign exchange to meet the needs of citizens.



Kabeer pointed to the embezzlement of part of the oil money, as he confirmed that, by reviewing the files, it was found that years ago the National Oil Corporation did not provide the public treasury with a part of the oil revenues, which amounted to about $3.2 billion.

 

Oil-rich Libya has been mired in chaos since the ouster and killing of Muammar Gaddafi in 2011. It now has two rival authorities and a multitude of militias vying for control of the country.

 

The country’s internationally recognised government is based in Tripoli, while Khalifa Haftar, the commander of the Libyan National Army, is supported by a parallel administration based in the east.

 

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