ISIS targets Libya’s oil industry

Originally commissioned November 2015

The oil sector is crucial to Libya’s economy and with it stability, which is why ISIS is disrupting it, a strategy ISIS is able to follow due to the country’s internal struggles, which themselves are also impacting the oil industry.

  • ISIS’ aim in Libya is to undermine the oil industry on which the country is reliant, and so destabilize the country economically, a strategy it uses across North Africa.
  • The ongoing civil war is allowing ISIS greater freedom to damage oil infrastructure, however, rivals have on occasion overcome their differences to fight ISIS.
  • Disagreements between the rival Libyan governments have also damaged the oil industry, with force majeure being declared in a number of locations, as a result.

 

Unlike in Syria, ISIS cannot derive significant income from oil in Libya, lacking strength to hold oil infrastructure and with no access to viable smuggling routes. Previous attempts by militant groups to ship oil out of the country were stopped almost immediately. Moreover, with global oil prices dropping, selling is becoming less profitable. Given the opposition the group faces, ISIS’ strategy is not to capture but to cause maximum damage to infrastructure and gain money from ransoms. This strategy can be seen in the attack on the Suncor-run Ghani field, the damage from which left the field inoperable for a long time and the attack saw many hostages taken. Their aim is also to scare off foreign oil companies and dent oil exports, accomplished by kidnapping foreign workers.

Oil is the lifeblood of the Libyan economy. It is no coincidence that in Tunisia, as well as in Algeria, targets in the tourist industry have borne the brunt of ISIS-aligned attacks. Tourism is estimated to account for 15.2% of Tunisia’s GDP. ISIS and affiliates are attempting to undermine the economy of a number of North African states and thereby create conditions for recruitment.

The ongoing civil war allows ISIS to act with greater freedom than it would otherwise have. ISIS is not the main priority for the country’s various security forces and militias. Moreover, General Haftar’s uncompromising stance towards Islamist groups, pitting his forces against even moderate Islamist militias, makes such militias less willing to risk their holdings to fight ISIS. Nonetheless, in Derna, for example, ISIS faced a relatively united front from normally opposing groups. ISIS had counted on more support than it has received in Libya; with many Islamist groups already on the ground, ISIS faces an uphill struggle attracting support. The tactic of damaging oil infrastructure may in fact lead more groups, otherwise divided, to unite against ISIS.

The rival Libya governments’ rival National Oil Corporations (NOC) have caused problems to the oil industry. The key Zueitina oil port has been closed again, amid disputes between the rival oil authorities and their respective militias, with the Tripoli-based NOC declaring force majeure on the site. By March of this year, force majeure had been declared at 11 oil fields, seriously impacting the country’s oil production. Production has fallen from an average of 430,000 barrels a day in 2014 to 350,000 per day in 2015, this compared to 1.6 million a day before the revolution. The damage to oil revenues caused by these disagreements and ISIS’ activity are driving the search for a resolution to the conflict between the rival governments.

 

 

 

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