In a surprising about-face, on July 10 eastern Libyan strongman Khalifa Hifter handed authority to manage Libya’s eastern oil ports back to the country’s legitimate Tripoli-based National Oil Corporation.

As noted in an earlier Al-Monitor article, the dispute was never really about who should have the right to export Libya’s oil, but rather about the system that distributes oil revenues among various entities and who has the right to preside over the system. Hifter has yet to explain why he relinquished control — and likely never will. He wisely avoided smuggling oil and his reversal could represent his bowing to international pressure. Behind the scenes, it appears that he made the case for the governor of the Central Bank of Libya (CBL) to be replaced, and then as it became clear that this desired outcome was never going to materialize, he backed down to a far more moderate face-saving concession. 

In reality, Hifter’s decision to hand over the oil crescent ports to the Eastern NOC was likely initially impulsive, and then two loose goals wound up being grafted onto it. Those goals are 1) to conceal his weakness at briefly losing control of the oil crescent ports to militia leader Ibrahim Jadhran the previous week by showing strength by standing up to the international community; and 2) to secure consistent funding for his Libyan National Army (LNA) — the center of his political and military power — by forcing his political adversaries in western Libya to reshuffle administrative control of the CBL and alter the distribution of oil revenue.

He achieved the first goal quite admirably as his action was initially received quite well by those demographics in eastern Libya to which he is beholden — namely the eastern tribes, the communities near the oil installations and his core supporters around Al-Marj.  p.p1 {margin: 0.0px 0.0px 0.0px 48.0px; text-indent: -48.0px; font: 21.0px Calibri; -webkit-text-stroke: #000000} span.s1 {font-kerning: none} To facilitate the second goal, he established five preconditions for reopening the eastern oil ports. As postulated in an earlier article, the most important of these was the replacement of CBL Governor Sadiq al-Kabir by Mohamed al-Shukri, who had been appointed bank governor by the parliament of the eastern government (the House of Representatives) and is thought to be a competent technocrat. Hifter had accused Kabir of political partisanship and funding terrorists. Among the other preconditions were convening a joint local and international investigative commission on oil revenue management and a commitment to the French plan for Dec. 10 elections. On their face, these preconditions are all reasonable goals, especially as they rightly point out that the primary problem in Libya is about moving to a system of guaranteeing equitable and transparent revenue distribution. Nonetheless, effectively blockading Libya’s oil infrastructure was an illegal and financially harmful way to try to achieve them.