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Lifeline: Turkey supplies at least $10M in fuel to east Libya
July 26, 2011 12:51 by Reuters
Turkish Petroleum International Company (TPIC), a subsidiary of Turkey’s state-owned oil and gas exploration company Turkiye Petrolleri (TPAO), has shipped two fuel cargoes worth at least $10 million, an industry source familiar with the deal said.
Turkey is set to deliver a further 18,000 tonnes of fuel to the Libyan opposition’s National Transitional Council, in addition to 10,000 tonnes it has already sent last week, Energy Minister Taner Yildiz said on Tueday.
The fuel support enables the rebel government to ease energy shortages in the east of the country, industry sources told Reuters on Monday.
Libya’s civil war has damaged oil infrastructure and severely hampered the rebel government’s ability to produce and sell oil, increasing its reliance on foreign aid to pay for imports of refined products.
Regular fuel supplies such as gasoline for cars and diesel used for power plants are vital to the rebels to win the war and retain popular support in a country long-accustomed to subsidised energy. A second industry source said the Turkish government was seeking to line up more suppliers and that he expected one or two more cargoes to be sent.
The supply deal is a sign of closer ties between Benghazi and Ankara, which recognised the rebel Transitional National Council earlier this month and pledged $200 million in aid.
It was not clear whether funding for these fuel deliveries was included in this sum, but the trade sources said that the fuel was being delivered for humanitarian reasons, with no payment expected.
HELP IS SANCTIONED
Oil firm Vitol has until now been the rebels’ main trading partner and has regularly shipped cargoes of oil products, but the oil minister said last month they have had to request payment extensions. Qatar has also supplied fuel to the rebel government.
“It’s not that the Vitol deal is insufficient — this is free,” said a Libyan oil industry source, working with the rebels. Other oil traders active in the Mediterranean told Reuters they were interested in supplying Libya but that banks were still blocking payments to the TNC due to sanctions.
An oil ministry source said last week that the rebels were looking for an alternative supplier and that at least one other oil firm said it was in talks with them in an early sign that the Libyan oil trade may be picking up.
Exact import requirements are unclear, but an industry source with knowledge of the Libyan market said they were around 50,000 tonnes a week.
West Libya is also suffering from fuel shortages as international sanctions and NATO cargo interceptions have deterred traders from delivering via tankers. Instead, smugglers are importing fuels overland from Algeria and Tunisia. (Reporting by Pinar Aydinli, Emma Farge and Humeyra Pamuk, Reuters)