Abu Dhabi: Libya is unlikely to increase its oil production in the near future and that could create an impact on global oil prices, energy experts said.

From $115 (Dh422.4 billion) in June, oil prices have plunged to less than $50 in June before recovering later on.

Geoff D. Porter, president of the US based North Africa Risk Consulting told Gulf News in an interview in Abu Dhabi last week that there is too much uncertainty about Libyan oil production.

“They are currently producing about 600,000 barrels per day and are exporting in the range of 400,000 to 500,000 barrels per day but the exports are coming from storage and not from the current production. The current production is disrupted on a daily basis,” Porter said.

He said the market has disregarded Libya because there is no confidence that the country is capable of either sustaining 600,000 barrels per day or increasing to between 800,000 to one million barrels per day.

“Even if they are able to do so, how quickly will they do it? It’s been just too volatile for the market to account for Libyan production in global crude prices.”

The oil production which is being managed by National Oil Corporation is divided, amidst claims and counterclaims by the leadership in Tobruk and Tripoli that they have their own man in charge of the organisation, Porter said.

“Revenue is going to the central bank and is being divided [between] both sides of the conflict. It is a bizarre situation. The country is missing [a] million barrels a day due to civil war. It is having a huge impact. They are running a budget deficit and are in serious economic situation,” he said.

“Even if the civil war ends and unified government is installed in the country, you still have a population that is dissatisfied with their circumstances and will hold the hydrocarbon sector hostage in order to get the government to act with regards to their demands.”

According to the US Energy Information Administration, Libya is the holder of Africa’s largest proved crude oil reserves, and an important contributor to the global supply of light, sweet crude oil.

A member of the Organisation of the Petroleum Exporting Countries (Opec), Libya exports most of its crude oil to European countries, with Italy being the leading recipient.

The United States resumed importing crude oil from Libya in 2004 after sanctions were removed, although the amount imported is small.

The country’s oil production has slumped from 1.625 million barrels a day in the first quarter of 2011 to less than 600,000 barrels per day at present due to civil war and disruptions at the oil fields.

Dr Mamdouh G. Salameh, international oil economist and consultant to World Bank, said Libya’s oil industry is in a real mess.

“I don’t see Libya’s production returning to pre-2011 levels in the foreseeable future. The global oil market has taken Libya’s current oil situation in its stride and therefore it will have no impact on the global oil prices.”

Oil prices have been plunging in the last few months due to over-production and slowing economies. Opec is due to meet next month in Vienna to take stock of the situation and decide on slashing production to prop up prices.

The prospect of Iranian oil entering market has recently put a downward pressure on oil prices as the US and other major world powers hold discussions with the Islamic republic to lift sanctions over its controversial nuclear programme.