Blab Business
Libyas Oil Boom Fuels Political Paradox as Arkenu Exports Continue Amid UN Report
Libya’s oil sector is producing record volumes, but a United Nations report shows a private firm, Arkenu Oil Company, is siphoning billions of dollars in crude exports outside the state‑controlled revenue system.
The country is pumping an average of 1.4 million barrels of crude per day, the highest level in more than a decade. In 2025 the National Oil Corporation (NOC) logged 1.37 million barrels per day from operating companies, confirming Libya’s status as Africa’s top producer. Oil sales generated $22 billion last year, an 18 percent rise from 2024, according to the NOC’s May 2026 technical report.
Foreign investment has followed the uptick in output. TotalEnergies and ConocoPhillips inked a $20 billion, 25‑year partnership to expand the Waha fields, and other majors—Eni, Chevron, BP, and Repsol—have announced comparable commitments. Libya also completed its first public oil and gas licensing round in seventeen years, awarding blocks to international majors that had awaited a clear regulatory framework.
The political landscape remains divided. Field Marshal Khalifa Haftar controls the eastern oilfields and the military infrastructure that makes production possible. Prime Minister Abdulhamid Dbeibeh, the internationally recognized head of state, controls the NOC, the central bank, and the financial mechanisms that process oil revenue. Each side operates in parallel, relying on the continued flow of oil to fund their administrations.
Arkenu Oil Company, founded in Benghazi in early 2023, secured a partnership with the state‑owned Arabian Gulf Oil Company (Agoco), a subsidiary of the NOC that operates two of Libya’s largest fields. Instead of cash payments for its services, Arkenu received crude oil, which it then sold on international markets. In March 2026 the United Nations Panel of Experts on Libya identified the company’s owners as proxies of Haftar’s son, Saddam Haftar, and estimated that Arkenu’s export revenues between October 2024 and February 2026 would exceed $3 billion.
The $3 billion figure is not a trivial sum; it is a strategic resource that finances Haftar’s parallel institutions. The revenue supports military salaries for the Libyan National Army, tribal patronage networks, and the operational costs of a de facto state that has governed roughly half of Libya for nearly a decade.
In April 2026 Dbeibeh issued a formal suspension order targeting the arrangement, blaming Haftar’s camp for the mechanism. The decree was a symbolic exercise of accountability, but it did not halt the flow of exports. Subsequent reports from April and May confirmed that oil shipments linked to Arkenu continued. The NOC processed the shipments, a European commodity trading firm received them, and Arkenu collected the proceeds.
Arkenu’s persistence illustrates the broader dynamic that has shaped Libya’s oil sector for years. The country’s light, sweet crude has become strategically valuable to European refineries, especially after the Strait of Hormuz crisis forced a shift in supply routes. Foreign energy companies, many of whom have compliance officers familiar with the UN report, continue to invest because the barrels are profitable and the political risk is considered secondary to the need for supply.
Libya’s political impasse is not a failure of process but a consequence of an economic structure that allows both sides to fund themselves through oil. Elections, originally scheduled for December 2021, have been postponed repeatedly, and no credible timeline for a vote that would be acceptable to both factions exists.
The current situation remains that Libya’s oil production and revenue continue to rise, foreign investment deepens, and the Arkenu arrangement persists despite a formal suspension. Key unresolved questions include whether the NOC will enforce the suspension, how the international community will respond to the UN findings, and whether the political division will eventually be resolved.
The story underscores that Libya’s oil boom is the most significant obstacle to political resolution, and that the West, in its quest for barrels, is pouring billions into the sector.
The country is pumping an average of 1.4 million barrels of crude per day, the highest level in more than a decade. In 2025 the National Oil Corporation (NOC) logged 1.37 million barrels per day from operating companies, confirming Libya’s status as Africa’s top producer. Oil sales generated $22 billion last year, an 18 percent rise from 2024, according to the NOC’s May 2026 technical report.
Foreign investment has followed the uptick in output. TotalEnergies and ConocoPhillips inked a $20 billion, 25‑year partnership to expand the Waha fields, and other majors—Eni, Chevron, BP, and Repsol—have announced comparable commitments. Libya also completed its first public oil and gas licensing round in seventeen years, awarding blocks to international majors that had awaited a clear regulatory framework.
The political landscape remains divided. Field Marshal Khalifa Haftar controls the eastern oilfields and the military infrastructure that makes production possible. Prime Minister Abdulhamid Dbeibeh, the internationally recognized head of state, controls the NOC, the central bank, and the financial mechanisms that process oil revenue. Each side operates in parallel, relying on the continued flow of oil to fund their administrations.
Arkenu Oil Company, founded in Benghazi in early 2023, secured a partnership with the state‑owned Arabian Gulf Oil Company (Agoco), a subsidiary of the NOC that operates two of Libya’s largest fields. Instead of cash payments for its services, Arkenu received crude oil, which it then sold on international markets. In March 2026 the United Nations Panel of Experts on Libya identified the company’s owners as proxies of Haftar’s son, Saddam Haftar, and estimated that Arkenu’s export revenues between October 2024 and February 2026 would exceed $3 billion.
The $3 billion figure is not a trivial sum; it is a strategic resource that finances Haftar’s parallel institutions. The revenue supports military salaries for the Libyan National Army, tribal patronage networks, and the operational costs of a de facto state that has governed roughly half of Libya for nearly a decade.
In April 2026 Dbeibeh issued a formal suspension order targeting the arrangement, blaming Haftar’s camp for the mechanism. The decree was a symbolic exercise of accountability, but it did not halt the flow of exports. Subsequent reports from April and May confirmed that oil shipments linked to Arkenu continued. The NOC processed the shipments, a European commodity trading firm received them, and Arkenu collected the proceeds.
Arkenu’s persistence illustrates the broader dynamic that has shaped Libya’s oil sector for years. The country’s light, sweet crude has become strategically valuable to European refineries, especially after the Strait of Hormuz crisis forced a shift in supply routes. Foreign energy companies, many of whom have compliance officers familiar with the UN report, continue to invest because the barrels are profitable and the political risk is considered secondary to the need for supply.
Libya’s political impasse is not a failure of process but a consequence of an economic structure that allows both sides to fund themselves through oil. Elections, originally scheduled for December 2021, have been postponed repeatedly, and no credible timeline for a vote that would be acceptable to both factions exists.
The current situation remains that Libya’s oil production and revenue continue to rise, foreign investment deepens, and the Arkenu arrangement persists despite a formal suspension. Key unresolved questions include whether the NOC will enforce the suspension, how the international community will respond to the UN findings, and whether the political division will eventually be resolved.
The story underscores that Libya’s oil boom is the most significant obstacle to political resolution, and that the West, in its quest for barrels, is pouring billions into the sector.
