The Oil State That Runs Out of Gasoline

This story is about a country that sells oil to the world and cannot keep its own cars moving, and about how few hands it takes to switch that country off.

On the night of Monday, August 10, a drone hit a gasoline tank at the refinery complex in Zawiya, Libya.

Libya’s National Oil Corporation, the state oil company everyone calls NOC, said the tank held about 4.5 million liters. It caught fire and collapsed. Firefighters worked through the night to keep the blaze from spreading to the neighboring reservoirs, at a site that also stores diesel, kerosene and liquefied petroleum gas. A second drone came down near another tank.

“It’s a heinous act,” said Hamdi al-Bishti, head of the Brega Oil Company. “We came close to tragedy.” Putting the fire out was particularly difficult, he said, because of how much fuel was burning. He said there were no reported casualties. Libya’s Ambulance and Emergency Service, as reported by Al Jazeera, said there were no “serious injuries,” with “most patients treated for smoke inhalation.”

Prime Minister Abdulhamid Dbeibah called the strike “a direct threat to the lives of citizens and workers” and vowed to pursue whoever did it. NOC warned that if the attacks kept coming it would have to declare force majeure, the legal notice a company gives when events outside its control stop it from operating, and halt the complex.

How big is 4.5 million liters? In June, NOC’s chairman, Masoud Suleiman, said usual consumption “does not exceed 6.5 million litres” a day, in remarks about record gasoline distribution in Tripoli over the Eid holiday. His remarks, as published, do not say whether that figure covers Tripoli or the whole country, so we cannot say what share of a national day’s supply the tank held.

A country does not run out of gasoline because it loses one tank. So the question worth asking is what that tank was sitting on top of.

Record crude, two-kilometer lines

Start with the part that should make no sense.

On June 21, Libya produced 1,438,560 barrels of crude a day, plus 49,163 barrels of condensate, for a total of 1,487,723. NOC called it “the highest production rate recorded since 2013.” The target is about 1.5 million barrels of crude a day by the end of 2026.

Three months later, Reuters reported gasoline lines in Libya “up to two kilometers” long. A Brega mobile station capped sales at 300 liters per vehicle. On the black market, diesel sold for as much as 11 Libyan dinars a liter, about $1.70. The subsidized price is 0.15 dinars, so the top black-market price was about 73 times the official one.

Naseem Al-Akkari, who runs a restaurant in Tripoli’s Qasr Bin Ghashir district, told Reuters that power outages there can last up to 36 hours. He said he spends about $1,600 a day on diesel for his generator. Reuters put his losses at an estimated $40,000 in just a few months. Khaled Al-Turki, waiting in a fuel line, said it in one sentence: “We are living through a farce.”

The UN envoy for Libya, Hanna Tetteh, gave the Security Council the same picture on August 18, in a diplomat’s words. She called it a “striking paradox.” Libya spends about $1 billion a month importing fuel, she said, and still runs a power system that is vulnerable to fuel shortages.

The first gear is simple. Libya does not make most of the fuel it burns.

A joint report by Libya’s Audit Bureau and its National Anti-Corruption Authority, as reported by News Tunisia in June, found that local refineries cover no more than 24 percent of national fuel demand. The other 76 percent is imported.

Libya’s five main refineries “can theoretically process about 380,000 barrels per day,” Reuters reported, and actual output is far lower. The biggest of them, Ras Lanuf, has been shut since 2013. The audit says that one closure deprives the country of 58 percent of its refining capacity and costs nearly $1.2 billion a year.

Picture a farm that sells its wheat to the whole world, then buys its bread back from a supplier in town. That is Libya’s fuel system. Now add one detail. The supplier skims.

The leaky bucket

Draw the system the way a consultant would, as a flow chart. Crude goes out to buyers abroad. Refined fuel comes back in. Between the import and the pump, there are three leaks.

The first leak was the accounting. In 2021, according to the investigative group The Sentry, NOC stopped paying for fuel imports with Central Bank money and began swapping crude for fuel, in deals that stayed off the public balance sheet. The Sentry says NOC’s fuel imports “more than doubled” from early 2021 to late 2024, peaking at more than 41 million liters a day, and that NOC overpaid by up to $1 billion a year. The barter was halted in March 2025. Libya’s own Audit Bureau, as summarized by the Libyan outlet Sada, found the swap system understated official revenue and spending by 30 to 35 percent.

The second leak is smuggling. The Sentry estimates smuggling cost the Libyan state “$6.7 billion in 2024 alone,” and “almost $20 billion in three years,” with “more than half of all fuel procurements” diverted. That is an NGO estimate, and we name it as one. NOC’s own chairman described the plumbing in June. Some delivery trucks, Suleiman said, unload at illegal depots for smuggling to neighboring countries. Some stations sell a small amount at the pump and the rest to smugglers.

The third leak runs through the men with guns. The Audit Bureau found that from 2021 to 2024, gasoline drawn by the public security sector rose 621 percent. Its diesel rose 441 percent. Diesel for the armed forces rose 1,527 percent. From 2022 to 2024, fuel revenue actually collected came to only 596.7 million dinars. At the UN, Tetteh raised concerns over what Africanews described as “the alleged large-scale diversion of subsidized fuel in the electricity and security sectors.”

Put the price gap back in. Diesel costs 0.15 dinars at the pump and 11 dinars on the black market. At a 73-to-1 spread, smuggling is ordinary arithmetic. Buy at the official price. Sell at the real one.

As for who profits, The Sentry names names on both sides of Libya’s divide. It calls Saddam Haftar, a son of the eastern commander Khalifa Haftar, the “primary force behind this escalation” in fuel smuggling. It also names western militia figures, including Mohammed Koshlaf in Zawiya and Omar Bughdada in Misrata, the latter tied to Dbeibah’s government. That finding is about fuel smuggling, not about the drones. We found no public response from anyone it named.

One older fact belongs on the map. A UN sanctions summary, first published in 2018 and last updated in 2023, says Koshlaf’s militia controls the Zawiya refinery. We found no 2026 source that says who holds its gates today.

One valve, one gate

In September, the slow drip became a switch.

On September 15, NOC said members of the Petroleum Facilities Guard, the state force that protects oil sites, had “reportedly closed the main oil export pipeline valve (Hamada-Zawiya) without authorization.” Hamada, Al-Tahara and station NC5 shut down. NOC said it “may be compelled to declare force majeure.”

In the same statement it spelled out what was at stake. Oil revenue, it said, remains “the primary, and essentially the sole, source of funding for the state treasury,” and blockades could put “the payment of employees’ salaries” at risk.

On September 21, NOC said “an armed military group reportedly closed Valve No. 7” on the crude line from the Sharara field to Zawiya. Its teams could not reach valves 6 and 7. AFP reported that guards also blocked the gate of the Zawiya refinery. On September 22, NOC said its board was “preparing to declare force majeure within the coming hours if the valve is not reopened.”

The same day, according to the specialist newsletter Libya-Analysis, Dbeibah issued Decision No. 454 of 2026, putting the guards’ salaries under the same provisions as the army’s.

On September 26, NOC shut one of the two refining units at Zawiya to keep the other running as long as it could. In that statement it named who had closed the valve: “armed groups affiliated with the Petroleum Facilities Guard (Southwest) and the Western Military Zone.” NOC did not say whether those groups acted on the zone’s orders. The same day it announced that valve 7 had reopened, and thanked the “wise men of the region, and oil cadres stationed at the sites.”

NOC put the cost at about $95 million. It said lost crude came to more than 942,000 barrels for the week, with the worst single day, a Tuesday, near 260,000 barrels. And in its September 26 statement it warned that continued obstruction of the crude would mean “inflating the fuel import bill.” That one line is the whole machine. Shut the crude, and the country pays twice. It loses the oil it would have sold, and it buys more of the fuel its own refinery would have made.

The estimates of how much oil stopped came from different counters at different moments, so we give each with its date. On September 22, AGBI cited a Reuters report quoting two unnamed field engineers: output down around 200,000 barrels a day, with only 100,000 to 105,000 still flowing. Separately, NOC put the daily production loss at “approximately 130,000 barrels” and said it was “expected to increase if the shutdown persists.” Argus has described Sharara as a field that typically produces 300,000 barrels a day.

Our own arithmetic: 942,000 barrels over roughly five days averages about 190,000 barrels a day. That is an illustrative average, using a tally NOC gave while the closure was still on and an approximate five-day span. It does not settle which daily figure was right.

Why did they close the valves? AFP said it remained unclear what their demands were. Libya-Analysis reports the guards wanted to be moved financially and administratively under NOC, citing pay gaps with the army. It also cites “informed sources” saying a key driver was anger in Zintan over the September 9 reshuffle of the Waha Oil Company board, which named Khaled al-Jarbi chairman. It adds that Zintan groups have “a long history of closing off the valves” on the Sharara and al-Feel lines “as a means to extract concessions.” Pay, the board, or both. We give you the order of events. We do not claim the pay decision opened the valve.

The pattern, though, has a history. In February 2024, guards closed the Zawiya refinery, the Mellitah complex and the Greenstream gas pipeline to Italy. On a Sunday, Dbeibah approved a pay rise for the guard. On the Monday, gas flows to Italy and production at the Wafa field resumed, according to Oilprice.

On September 26, the UN mission in Libya recalled that actions undermining the country’s oil infrastructure “may constitute grounds for the imposition of measures” under Security Council resolutions, including resolution 2213 of 2015. In UN language, measures means sanctions.

The gear: a hold-up game

Zawiya is a single point of failure. One city holds a 120,000-barrel-a-day refinery, the fuel tanks, a 1,300-megawatt power station, and the end of two crude pipelines, one from Hamada and one from Sharara. The hands on those valves are not only guards. NOC said the September closure was carried out by armed groups affiliated with the Western Military Zone as well as the Petroleum Facilities Guard (Southwest). Leave Ras Lanuf out, and Zawiya is about 75 percent of the remaining nameplate refining capacity, by our arithmetic on a 2021 capacity table. Touch that one node and you touch the gasoline, the electricity and the export money at once.

Economists call the game that grows around a node like that a hold-up. One side has sunk everything into an arrangement that only works if the other side keeps cooperating. The other side knows it, and can name a new price at the moment of greatest need.

Think of a town with one road in, and one family that owns a stretch of it. The family does not need to own the town. It needs a gate. Every time the gate closes, the town pays, because a day without the road costs more than the toll. And every time the town pays, the family learns the gate works.

Run Libya through that. Closing a valve costs the closer very little. Keeping the Sharara valve closed cost the state about $95 million in one week and one of the two refining units at its biggest working refinery. The Hamada closure a week earlier drew a warning about its payroll. The cheap move for the state is to pay. In 2024, gas flowed again the day after a pay rise. In 2026, a pay decision landed in the middle of the closure, and the valve reopened four days later. NOC credited “joint efforts” and the region’s wise men, not the decree. If the toll is what reopened it, then a toll that keeps getting paid teaches every other gatekeeper the price.

Who flew the drones

Go back to August, because the headlines are about the drones, and the honest answer to who flew them is that nothing we found shows it yet.

First, the established facts. In the days before the gasoline tank burned, drones struck a naphtha reservoir and a water desalination plant at Zawiya. Agenzia Nova dates those strikes to August 8 and 9. On Tuesday, August 11, Xinhua reported, a drone hit a diesel tank at the complex. The same day, a drone hit the Zawia power station, rated at 1,300 megawatts.

GECOL, the state electricity company, said the attack on the 30/11 kV substation south of the city resulted in it “completely burning down and going out of service.” The hit on the power station itself, GECOL said, “did not result in any serious damage or casualties.” It said the attackers used fiber-optic armed drones, and posted photos of the debris. General Electric “halted all operations at the site and withdrawn its technical teams pending assurances of security and a safe, suitable working environment.” GECOL warned that more losses “could lead to widespread system disruptions, potentially resulting in partial or total grid blackouts.”

We found no claim of responsibility for any of the strikes, and no public forensic report naming who sent them.

Four explanations are on the table. Each has its own source and its own weakness.

The first is the government’s own. On September 6, Dbeibah’s Government of National Unity, the GNU, announced that five Libyan and foreign nationals had been arrested and a “sabotage cell” dismantled. It named no nationalities and no sponsor.

The second, aimed at Saddam Haftar, arrived a month later, through anonymous sources. On October 3, the Guardian’s Patrick Wintour reported “allegations that” Saddam Haftar “oversaw a ‘terror cell’” behind the drone attacks. Unnamed GNU sources told the paper: “No formal decision has been made, but in light of what has been discovered it is impossible to work with Saddam.” The alleged motive was anger at Dbeibah “apparently stalling” on the Boulos plan, a US-backed proposal to merge Libya’s rival governments, and at Tripoli “allegedly encouraging tribes” to attack Haftar’s forces.

The Guardian also reported that on September 5, three Libyans and one Spaniard were arrested in southern Tripoli over an alleged plot that included an attack on Tripoli airport. The group was “thought” to be five Spaniards and four Libyans, and the three Libyans were “allegedly affiliated” with the Tareq ben Ziyad brigade of Haftar’s Libyan National Army, the LNA. The government announced five arrests, the Guardian four. It is not clear whether these are the same arrests.

Notice the gap between those two. The government’s own announcement named no sponsor. On September 8, the Libya Observer reported that Ahmed Hamza, head of the Libyan Institution for Human Rights, had said in a Facebook post that reliable sources confirmed a direct link between a cell arrested over the drone attacks and Omar Marajea, whom he described as a commander in Khalifa Haftar’s forces. He also accused Haftar-affiliated entities of funding sabotage in western Libya. The claim that Saddam Haftar himself oversaw the cell came later, through anonymous sources.

The third points the other way. An analysis by Radio France Internationale, carried by the Libya Observer on August 16 and resting on anonymous military sources, said Ukrainian-made fiber-optic drones “may have been deployed,” and that suspicion fell on armed groups loyal to the Tripoli government.

The fourth is the plainest. The New Arab, on October 4, said the allegations against Saddam Haftar “have not been independently verified” and “have not been publicly substantiated.” It noted that “earlier analysis” pointed to Zawiya’s rival armed groups competing over “lucrative fuel-smuggling networks.”

We do not pick one. The Haftar family and the LNA have not answered the allegation in anything we found. The GNU has not published the evidence behind it. Until one of those changes, it is an allegation, and we call it that.

What the drones did, and what they did not

The Guardian wrote, in its own voice, that the drone round worsened Libya’s blackouts. The record shows the power crisis was already here.

According to leaked GECOL briefings reported by the Libya Herald in July, about 1,000 megawatts of generation had been lost to gas and heavy-fuel shortages, and about 700 megawatts more when the Zawia plant was damaged in clashes in the city. Load shedding ran five to seven hours before a total blackout on Saturday, July 18, from Misrata to the Egyptian border, after 1,350 megawatts dropped off the grid. GECOL’s director general had written to the prime minister and the attorney general on June 4. All of that came before the August drone strikes on Zawiya’s fuel tanks and power station.

The gas side is disputed too. GECOL asked for a halt to gas exports to Italy. NOC answered that in peak summer it exports “no more than 10%” of the Italian partner’s total share, with most “consumed domestically to meet citizens’ needs and support the electricity grid.”

And not every outage was an attack. On the night of August 15, most of western Libya lost power. GECOL blamed a technical fault at the Zawia power station.

So the drones landed on a fuel chain and a power grid that were already failing. That is why a few strikes on one city could put a whole country on edge.

Our call

We put it at 85 percent that NOC does not declare force majeure on the Sharara field or the Sharara-Zawiya pipeline at any point from October 6 through November 30, 2026. Threats do not count. A new closure does not count on its own. Only a declaration does.

Start with the base rate. NOC declared force majeure on Sharara on April 18, 2022, after protesters shut the field. It declared again effective January 7, 2024, after another protest closure, and again on August 7, 2024. Those are the three declarations on Sharara we found from April 2022 to now, about four and a half years. Our search may have missed others. Spread evenly, that is roughly a 10 percent chance in any eight-week window.

This year runs hotter. NOC threatened force majeure at least three times in six weeks: August 11 over Zawiya, September 15 over Hamada, and September 21 to 22 over Sharara and Zawiya. The allegation against Saddam Haftar, which rests on unnamed GNU sources, has soured the unification track. And the Zintan grievance over the Waha board is something a pay decree does not obviously fix.

Against that, none of the 2026 blockades we tracked ended in a declaration. NOC’s English news listings for October, checked on October 6, show none through October 5. Net it out and we land near 15 percent for a declaration, so 85 percent for the call.

The call is wrong if NOC, or Reuters, AFP or the Libya Herald quoting NOC, reports a force majeure declaration covering Sharara or the Sharara-Zawiya pipeline, effective at any point from October 6 through November 30, 2026. A declaration on Sharara crude exports or Sharara loadings at the Zawiya terminal counts, as in 2024. A declaration limited to the Zawiya refinery alone, or to other fields, does not count. We will check NOC’s feed again before this runs. The 85 goes on the scoreboard, to be proven right or wrong in public.

What to watch

• NOC’s statement feed. A declaration settles the call in a day.
• Guard pay. Whether salaries under Decision 454 actually arrive.
• Zintan. Any move over the Waha board reshuffle.
• The UN. Any Security Council follow-up to the resolution 2213 language.
• The cell. Whether the GNU publishes its findings, and whether the Haftar side answers.
• The unification talks. Whether a deal survives the allegation from unnamed GNU sources. The UN-sponsored “4+4” agreement, signed in Tripoli on August 30, calls for elections “within a period not exceeding 24 months.” The House of Representatives endorsed it on September 14. The High Council of State has reportedly rejected it. The Boulos plan is unpublished, and outlets describe it differently. Boulos himself: “It’s not about families or names.”

The bottom line

Libya has plenty of crude and a plumbing problem. The crude comes up in record volume and goes abroad. The fuel comes back by tanker, leaks on its way to the pump, and meets the country’s refining and its power in one city, where a closed valve or a few drones can reach both. In 2024 the gas flowed again the day after a raise. In 2026 a pay decision came in the middle of the closure, and the gate opened four days later. Whether that is a price worth paying or a toll that only goes up is your call.

A country that pumped nearly 1.5 million barrels a day in June is waiting in a two-kilometer line for gasoline. Both facts run through the same city.

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Sources

• Zawiya gasoline tank (about 4.5m litres, per NOC), overnight firefight, second drone and no reported casualties (per al-Bishti), products stored, 120,000 bpd capacity, al-Bishti quote, NOC force majeure warning, Dbeibah quote, earlier naphtha and desalination strikes, none claimed: The Arab Weekly, Aug 12 2026.
• Ambulance and Emergency Service: no “serious injuries,” “most patients treated for smoke inhalation”: Al Jazeera, Aug 11 2026.
• Dates of the naphtha tank (Aug 8) and desalination plant (Aug 9) strikes: Agenzia Nova, Aug 2026.
• Aug 11 diesel tank strike: Xinhua, Aug 12 2026.
• Zawia power station and substation strike (Aug 11; article dated Aug 12 says “yesterday”), GE withdrawal, GECOL grid warning, fibre-optic drones: Libya Herald, Aug 2026. GECOL statements as carried.
• Western Libya blackout on the night of Aug 15 (article dated Aug 16 says “last night”), technical fault: Libya Herald, Aug 2026.
• RFI analysis (anonymous military sources): Libya Observer, Aug 16 2026. Low confidence; attributed.
• Audit Bureau and National Anti-Corruption Authority report (24% local cover, 76% imported, Ras Lanuf 58% and $1.2bn a year): News Tunisia, Jun 9 2026. Single outlet; report text not located.
• Audit Bureau figures (621%, 441%, 1,527%; LYD 596.7m; swap understated revenue and spending by 30 to 35%): Sada, Jun 8 2026.
• Refinery nameplate (380,000 bpd), fuel lines up to 2 km, 300-litre cap, black-market diesel 11 LYD vs 0.15 subsidized, 36-hour outages, Al-Akkari and Al-Turki: Reuters via Arab News, Sep 17 2026. The 73x ratio is our arithmetic.
• Refinery capacity table used for the Zawiya 75% share of nameplate capacity outside Ras Lanuf (our arithmetic: 120,000 of 160,000 bpd; 2021 nameplate data, current operating status not established): Prospect / Energy Capital & Power, 2021.
• Crude-for-fuel swaps, imports “more than doubled” from about 20.4m litres a day in early 2021 to a peak above 41m by late 2024, barter ended effective March 1 2025, $6.7bn and about $20bn smuggling estimates, named figures: The Sentry, “Inside Job,” Nov 13 2025; full report PDF. NGO estimates and findings; no response from those named found.
• UN envoy Tetteh, “striking paradox,” about $1bn a month, diversion concerns (“alleged” is Africanews’s wording, not a quote of Tetteh): Africanews, Aug 19 2026; briefing date: Security Council Report, October 2026 forecast.
• NOC chairman Suleiman on 6.5m litres a day (in remarks on Tripoli distribution over Eid) and smuggling via illegal depots and stations: Libya Herald, Jun 2026. Scope of the 6.5m figure (gasoline, national) not stated in the text.
• Production record, 1,438,560 bpd crude plus 49,163 bpd condensate, Jun 21 2026; 1.5m bpd target: Libya Herald, Jun 2026.
• Hamada-Zawiya valve closure, treasury and salaries language (Sep 15): NOC statement. Primary.
• NOC’s Sep 22 figure of “approximately 130,000 barrels” daily loss, “expected to increase”, force majeure “within the coming hours”: NOC, Sep 22 2026. Primary.
• Valve 7 closure by “an armed military group” (Sep 21), valves 6 and 7 unreachable: NOC, Sep 21 2026. Primary. Engineers’ flow figures and Reuters’ 200,000 bpd fall, as cited by AGBI: AGBI, Sep 22 2026; refinery gate blocked, NOC’s 130,000 bpd figure, demands unclear: Arab News / AFP, Sep 23 2026.
• NOC “within the coming hours,” Decision No. 454 (single specialist source), Waha board reshuffle and Zintan valve history (informed sources): Libya-Analysis, Sep 23 2026.
• Zawiya refining unit shut, closure by “armed groups affiliated with” PFG (Southwest) and the Western Military Zone, “inflating the fuel import bill” (Sep 26): NOC.
• Valve 7 reopened (Sep 26), “wise men of the region”: Libya Herald, Sep 26 2026; NOC, Sep 26 2026.
• About $95m cost, more than 942,000 barrels lost for the week (NOC tally reported Sep 26, while the closure continued), near 260,000 on the worst day: The National, Sep 26 2026. The 190,000 bpd average is our arithmetic.
• February 2024 guard closures (Zawiya refinery, Mellitah, Greenstream), Sunday pay-rise approval, Monday resumption of gas flows to Italy and Wafa output: Oilprice, Feb 2024.
• UNSMIL statement and resolution 2213 (Sep 26): Libya Herald, Sep 26 2026.
• Koshlaf’s militia and the Zawiya refinery: UN Security Council 1970 sanctions summary, first published Jun 7 2018, updated Apr 10 2023.
• GECOL leaked briefings (1,000 MW and 700 MW lost, 5 to 7 hours of load shedding, Jul 18 total blackout, Jun 4 letter): Libya Herald, Jul 20 2026.
• GECOL’s call to halt gas exports to Italy, NOC on the Italian partner’s share and Greenstream: Libya Herald, Jul 28 2026.
• GNU “sabotage cell” announcement (Sep 6): Libya Herald, Sep 2026.
• Ahmed Hamza’s claim linking an arrested cell to Haftar commander Omar Marajea and accusing Haftar-affiliated entities: Libya Observer, Sep 8 2026. Allegation, attributed.
• The Saddam Haftar allegation, GNU anonymous sources, Sep 5 arrests, Boulos “It’s not about families or names”: The Guardian (Patrick Wintour), Oct 3 2026. Allegation only; rests on anonymous sources.
• “Not independently verified,” earlier analysis on Zawiya’s armed groups: The New Arab, Oct 4 2026.
• Boulos plan background: Al Jazeera, Jul 8 2026.
• UN-sponsored “4+4” agreement (Aug 30, 24-month election window): Al Jazeera, Sep 1 2026; HoR endorsement on Sep 14 and HCS reported rejection: Security Council Report, October 2026 forecast.
• Force majeure base rate: Sharara Apr 18 2022 (field typically produces 300,000 bpd): Argus, Apr 2022; Sharara Jan 7 2024: Rigzone, Jan 9 2024; Sharara crude exports Aug 7 2024: Argus, Aug 2024, MEED.
• No force majeure declaration in NOC’s English October listings through Oct 5 (checked Oct 6; a bounded search, not a full census): NOC, September 2026; NOC, October 2026.
• Hold-up problem (framework): Benjamin Klein, Robert Crawford and Armen Alchian, “Vertical Integration, Appropriable Rents, and the Competitive Contracting Process,” Journal of Law and Economics (1978).