Oil as a commodity is intertwined intimately with national strategies, power and global politics. This was a central theme in Daniel Yergin's The Prize: The Epic Quest for Oil, Money and Power. Few places illustrate this inflammable mix as effectively as Libya today.
According to OPEC, Libya is the 16th largest country in the world with a land mass of 1.8 million square kilometres (700,000 sq. miles). More than a quarter of the country's six million plus inhabitants live in its capital city, Tripoli.
Since January, exports from Africa's oil giant have been hit by a blockade imposed by forces loyal to Field Marshal Khalifa Haftar. As a result, the war-ravaged country has lost billions of dollars in much needed revenue. In a show of strength, Haftar's Libyan National Army (LNA) has blocked oil exports in order to gain more access to revenues from the Central Bank of Libya. At the heart of this move is a dispute about how to divide the country's oil revenues; it remains a major stumbling block for a resolution of the conflict.
Meanwhile, a Pentagon report has revealed that since the final quarter of 2019 the number of Russian mercenaries associated with the Russian Wagner security company, which is linked to the government in Moscow, has increased significantly in Libya. They were, according to the report, recruited to support the supposedly retired Haftar. For the US, this has been an unwelcome development, so it has been warning the LNA that its affiliation with the Wagner Group and continued shutdown of the oil installations contradict America's interests, and this may warrant sanctions.
Last month, there were signs that the blockade could come to an end but, according to the Wall Street Journal, Haftar changed tack when in June the Wagner Group seized control of Es-Sider, Libya's largest oil field and its most important port for oil exports. The advance has helped the Libyan warlord Haftar to maintain his blockade of the country's petroleum exports in defiance of US pressure to restart them.
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In recent weeks, the Wagner Group has seized control of two of Libya's largest oil facilities, thereby heightening tensions between Russia and the US over Moscow's growing footprint in the Libyan war, following what it has done in Syria. These tensions have forced Libya's National Oil Corporation (NOC) to express concerns about the increasing foreign military presence in the country. Clearly disturbed, its chairman Mustafa Sanalla pointed out that, "Guns and oil do not mix."
For now, the NOC is keeping a close eye on activities around the oil fields and facilities. It is documenting illegal activities and has vowed to seek the prosecution of those who damage operations. Officials have called for the removal of mercenaries and the demilitarisation of the oil facilities in order to ensure their security and the safety of the workers.
As far as the Government of National Accord (GNA) is concerned there is ample evidence that Russian mercenaries are not only blocking the oil corridors in Libya but are also endangering the lives of Libya's civilians. Last April, Wagner was accused by Libya's Interior Minister, Fathi Bashagha, of carrying out a chemical attack in the country. Bashagha condemned the mercenaries for using a nerve agent against GNA forces in Salah Al-Din area in southern Tripoli. Furthermore, the Tripoli authorities have accused Haftar of using the mercenaries to intensify his indiscriminate attacks against civilians by shelling densely populated residential areas in Tripoli and bombing hospitals, health facilities and ambulances.
The Libyan tragedy has been worsened by the support for Russian intervention coming from the UAE and Egypt. The surge of foreign mercenaries in Libya has alarmed the GNA, which has released photographs and videos of Sudanese and Chadians fighting alongside Haftar's forces and looting the properties abandoned by Libyans.
"Shame and disgrace on those who brought in these mercenaries," said Bashagha. "This will only make us fiercer in this war. We will send the corpses of these mercenaries to their countries, and we will prosecute in international courts those who participated in bringing them to Libya."
The tension between rival foreign interests in Libya has forced the acting UN envoy, American diplomat Stephanie Williams, to warn of the huge risk of a miscalculation which could trigger a direct confrontation as weapons and mercenaries continue to pour into the North African state.
The conflict between the GNA — which is supported by Turkey and Qatar — and Khalifa's LNA —backed by Russia, Egypt, the UAE and Saudi Arabia — has hit Libya's oil industry badly. Russia's intervention and meddling in the country's oil sector has prevented Libya from restarting exports.
READ: Libya sees $7.9bn losses due to oil installations closures
If current trends continue, officials in Washington hold the view that Russia will stunt economic growth in Africa; threaten the financial independence of African nations; inhibit opportunities for US investment; hinder US military operations; and pose a significant threat to US national security interests.
Undoubtedly, it would take much more than press disclosures to change Moscow's policy in Libya. After all, it remains a powerful player in the global energy market with mega-companies like Rosneft and Gazprom. They have declared their interest in oil and gas exploration in Libya, Mozambique and Nigeria. However, it is in the area of nuclear energy and technology in Africa that Russia has been gradually building up partnerships.
Clearly, Russia's involvement in Libya poses a direct challenge to NATO and Europe, as well as their influence across the wider Middle East and North Africa region. Vladimir Putin's priority is not to be a deliverer of peace anywhere. In the case of Libya, his foremost concern is to exploit the country's natural resources for Russia's own benefit. Hence, how Russia and its NATO rivals manage the balance of power in Libya will almost certainly determine the region's future.
The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.