KEY POINTS
- Libya awarded diesel and gasoline supply contracts to Vitol, Trafigura and TotalEnergies to reduce Russian fuel imports.
- The country aims to raise crude output to 1.6 million barrels per day by 2026 and 2 million by 2030.
- Libya is expanding gas production and reopening exploration to attract Western energy majors.
Libya has awarded new fuel supply contracts to major Western trading houses and oil companies as it seeks to cut back on Russian imports and accelerate a broader revival of its energy sector.
According to a Reuters report, global commodity traders Vitol and Trafigura, along with French energy giant TotalEnergies, won tenders to supply diesel and gasoline to the North African country. The move signals a shift in sourcing strategy as authorities work to diversify supply and limit reliance on Russian refined products.
The contracts come at a pivotal moment for Libya, which is attempting to rebuild and modernize an oil industry battered by years of political upheaval and underinvestment.
A push to rebuild crude output
According to Oilprice, nearly 15 years after the 2011 uprising that toppled Muammar Gaddafi, Libya is pressing ahead with plans to restore its standing as a major Mediterranean energy supplier. The conflict fractured the country’s infrastructure and discouraged foreign investment, leaving production volatile for years.
Officials are now targeting an increase in crude output from about 1.4 million barrels per day to 1.6 million barrels per day by the end of 2026. Longer term plans aim for production of 2 million barrels per day between 2028 and 2030.
Libya holds more than 48 billion barrels of proven oil reserves, most of it high quality light sweet crude that typically commands strong demand in global markets. The country also possesses significant natural gas resources that remain largely underdeveloped.
Western firms return after years away
Momentum has been building in recent months. Libya concluded its first major licensing round in 17 years, awarding five exploration blocks to Chevron, Italy’s Eni, Spain’s Repsol, QatarEnergy and Nigeria’s Aiteo.
The government has also signed a 20 billion dollar, 25 year agreement with ConocoPhillips and TotalEnergies to modernize infrastructure and expand capacity at the Waha Oil Company.
Western oil majors are returning after a long absence, encouraged by improved stability following a 2020 ceasefire that eased years of armed conflict. Authorities have introduced more attractive fiscal terms under production sharing agreements in an effort to draw international oil companies back into the country.
Gas expansion targets European markets
Libya is also expanding its natural gas ambitions. The country aims to raise production to roughly 1 billion cubic feet per day, or about 10 billion cubic meters annually, by 2030.
Part of that output is expected to support exports to Europe through the Greenstream pipeline, while also supplying domestic industrial projects.
The National Oil Corporation has confirmed plans to begin unconventional and shale gas exploration in the second half of 2026. The initiative forms part of a broader strategy outlined by NOC Chairman Masoud Suleiman at the LNG2026 conference in February 2026, aimed at leveraging an estimated 80 trillion cubic feet of gas reserves.
