Libya: UNSMIL Calls for Talks as Eastern Government Stops Oil Production
Summary:
On 26 August 2024, The United Nations Support Mission in Libya (UNSMIL) called for an emergency meeting on Libya’s Central Bank crisis as tensions between the country’s two rival governments have continued to grow.
UNSMIL also called for guaranteeing the safety of Central Bank employees and for lifting the shutdown of oil production as the two rival governments have sought to create pressure on one another. UNSMIL indicated that unilateral decision-making and leveraging oil production as a political tool were eroding stability.
The declaration from UNSMIL came as the Presidential Council in Tripoli ousted the Central Bank governor, Sadek El-Kebir, on 18 August and replaced him with Mohamed Chokri. However, Chokri refused to assume his duties unless tensions cease and an agreement is reached between the Presidential Council in Tripoli and the eastern-based House of Representatives (HoR).
The ousted Central Bank governor, Sadek El-Kebir refused to step down and the eastern government led by Khalifa Hafter-backed Oussema Hamad announced the shutdown of oil production in response to the Presidential Council decisions.
Outlook:
Attempts at unilateral control of Libya’s Central Bank by the Tripoli-based government and the control of oil resources by the eastern government reflects the current fragility faced by the country. The conflicting interests of tribal groups, militias, and official government actors will likely continue to drive unilateral economic, security, and political decisions that further erode security and the hope of a viable political solution.
This crisis over the control of the Central Bank in Libya is starting to have regional and global impacts as oil prices jumped by 3% and Tunisian businesses are halted in Libya because of the suspension of commercial transactions.
With the eastern government unlikely to re-start oil production if revenues are channeled through the Central Bank in Tripoli, the possibility of unpredictable and potentially violent escalation remains.
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