TSG IntelBrief: Libya: Separatists and the Battle for Control of Oil
March 18, 2014

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• On March 16, at the Libyan Government’s request, US Navy Seals took possession of a tanker carrying 234,000 barrels of oil illegally exported from Libya’s El Sider port a week earlier
 
• This will not lead to the restoration of Ali Zeidan as Prime Minister. He was removed from office by Libya’s Parliament following the tanker’s escape, and fled to Germany, defying a travel ban
 
• Armed separatists have been blockading three of Libya’s main oil ports since last summer, depriving the central government of much needed oil revenues while demanding a greater share of the country’s oil wealth
 
• The incident brought the Government to the point of collapse, but the recovery of the oil shows the militias in the Eastern provinces that they do not hold all the cards in their search for greater autonomy for the Libya’s historic Cyrenaica region
 
• The country has undergone an anarchic post-Arab Spring transition from authoritarian towards democratic rule and is challenged by the lack of state foundations to weather such crises.

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Post-Arab Spring Chaos and the Absence of Institutions

Though Libya has already had plenty of trouble navigating the turbulence of its post-Arab Spring period following the overthrow of Colonel Muammar Qadhafi in 2011, developments over the past few months have brought the oil-rich North African country close to the point of collapse. Competing political assassination campaigns and clashes between various militias and pro-government forces have prevented the development of a stable Libyan state, and the recent crisis over an attempted illegal export of Libyan oil has highlighted the powerlessness of its central institutions—just forming after reign by personality—to implement security and establish control over the country’s main economic resources.

Much of the problem lies in the East of the country where rebels fought first and hardest against Qadhafi’s rule and today hold hostage the country’s oil revenues in their push for political autonomy for the country’s eastern coastal region of Cyrenaica. But many of the country’s rebel militias elsewhere have similarly refused to give up their arms, thus promoting the country’s descent into lawlessness and the increasing sense of crisis. Militias act independently of the central government and have continually demonstrated the powerlessness of the fledgling Libyan National Army. Indeed, a car bomb attack on an Army graduation ceremony in Benghazi on March 17 shows the level of resistance to any attempt by the central authorities to rebuild state institutions. As a result, large swaths of Libya, particularly in the East, remain under total militia control and the sense of a Libyan identity is eroding.

The November 2012 appointment by the General National Congress (GNC) of Prime Minister Ali Zeidan, a former Qadhafi defector and human rights activist, did little to stem the violence. The liberal Zeidan faced strident opposition from the Muslim Brotherhood as well as a number of Islamist groups and in October 2013, was briefly kidnapped by a rogue militia from a hotel in Tripoli before being returned to his office under armed escort. Representatives in the GNC are backed by rival militias, which systematically carry out targeted killings of politicians, activists, and government officials.

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Battle for Control of Crude Oil Escalates

In recent months, protests at oil ports and fields across Libya have paralyzed the country’s output and have led to a steep decline in oil revenues. Armed separatists have maintained control over three of the country’s major oil ports since August and have battled pro-government forces to continue an ongoing blockade, hoping to weaken the central government as oil revenues plummet. The Morning Glory, a stateless oil tanker carrying 234,000 barrels of oil, was the first to load oil from a rebel-held port since July, and threats of military action from the central government failed to dissuade it from departing for international waters.

The escape of the Morning Glory and the failure of the Libyan Navy to take back the vessel (though it was apparently damaged as it left port) humiliated the central government and prompted a vote of no confidence in Zeidan. The former Prime Minister fled Libya, and is reported to have arrived in Germany.

The response of the United States to an appeal from Libya to help recover the stolen oil led to a successful operation by Navy Seals who then planned to sail the tanker to a government-controlled port. This will restore some of the Libyan government’s credibility, and it will also show the rebels that although they may be able to starve the government of income by controlling oil terminals and loading ports, they will not find it easy to profit financially.

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Push for Autonomy in Cyrenaica

Libya’s heterogeneous ethnic and tribal makeup further exacerbates the country’s national unity and leadership deficit and amplifies calls for partition. The country can be divided into three distinct regions: Tripolitania, Cyrenaica, and Fezzan. “Federalist” militias from the eastern region of Cyrenaica, which includes the city of Benghazi where the 2011 Revolution was born, have embarked on an aggressive campaign for autonomy and a greater share of the country’s oil wealth.

Ibrahim Jathran, a federalist militia commander and leader of the blockade of Libya’s oil ports, sees the ongoing battle for control of Libya’s oil as a key step towards securing these objectives. The central government’s threat to launch a military operation to retake the rebel-held ports will reveal the extent to which militia groups control Libya. Meanwhile, clashes between militias in the West further threaten the government’s fragile hold over the country. As the oil crisis continues, depriving Tripoli of much-needed oil revenues while empowering rebel militias, the central government may be forced to cede to some separatist demands.

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Geostrategic Outlook

Zeidan’s departure illustrates the impotence of the institutions in which the international community has grounded its hopes for the foundation of a modern Libyan state. The fracturing of Libya, three years after the start of the Arab Spring and the successful removal of Qadhafi from power, demonstrates that any expectation that a popular movement for reform could translate easily and peacefully into a more secure and democratic state was wishful thinking at best. Between the ongoing war in Syria, a military coup in Egypt, and the potential disintegration of Libya, the outward progress of the Arab Spring has devolved into a number of grave regional issues that may take decades to resolve.  

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• The Morning Glory crisis may portend greater instability as government forces stand off against increasingly powerful militias
 
• Deputies will elect a new prime minister within the next two weeks; in the meantime, Defense Minister Abdallah al-Thinni has replaced Zeidan as acting Prime Minister. His first step will be designing an emergency budget as the government nears bankruptcy in the wake of an estimated $8 billion in lost oil revenues
 
• The GNC has threatened a military campaign to liberate the rebel-held oil ports; the outcome of this campaign may determine the course of the new Libyan state
 
• The fragility of the Libyan state and impotence of its armed forces leave it vulnerable to federalist pressures; the partition of Libya may be forthcoming.
 
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