The Libyan economy is heavily dependent on the hydrocarbon industry which, according to the International Monetary Fund (IMF), accounted for over 95 percent of export earnings; an estimated 85-90 percent of fiscal revenues; and over 70 percent of the country’s gross domestic product (GDP) in 2008. According to the Oil and Gas Journal (OGJ), Libya holds close to 44 billion barrels of oil reserves, the largest in Africa. EIA data indicate that 2008 total oil production (crude plus liquids) was approximately 1.88 million barrels per day (bbl/d).
The Libyan government plans to increase its oil reserves, production capacity, and further develop the natural gas sector in the medium-term as the country continues to recover from over a decade of U.S. and international sanctions. The United Nations and the United States lifted sanctions on Libya in 2003 and 2004, respectively, and in 2006, the United States rescinded Libya’s designation as a state sponsor of terrorism. Since then, international oil companies have stepped up investments in hydrocarbon exploration and production despite some degree of regulatory uncertainty.
Libya’s energy consumption mix has remained relatively constant throughout the decade, with approximately 70 percent of energy demand being met by oil and 30 percent by natural gas. However, with electricity demand on the rise, the government is planning to expand the use of natural gas to meet domestic needs while also exploiting solar and wind potential in more rural areas.
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