Libyan Central Bank Kidnapping Highlights Oil Wealth Rivalry

After the kidnapping of one of its employees and a rival government attempt to oust its head, the Libyan Central Bank on Monday said it had resumed operations, as a battle intensifies to control the financial institution that handles the country’s oil revenues. 

Libya’s Presidential Council, controlled by rival government forces in Tripoli, are jockeying with the rival government in the east–controlled by strongman General Khalifa Haftar–to insert their own central bank governor. Tripoli has attempted to force eastern-aligned Central Bank governor Al-Siddiq Al-Kabir out and replace him with Mohamed Shukri. 

On Sunday, the Central Bank said it would shut down all operations following the kidnapping earlier in the day of a senior bank official, vowing to keep the doors closed until the kidnapping victim, the head of the bank’s IT department, was safely returned, stating that "the bank rejects the mob-like methods that are practiced by some parties outside of the law”. 

On Monday, operations resumed after the kidnapped employee was returned on Sunday evening, according to Libyan media reports. 

Over the past week, armed forces have been gathering outside the Central Bank headquarters, creating concern that the country could slip back into a state of civil war as eastern and western factions scramble for control over oil. 

Al-Kabir has had strained relations with both governments; however, Libyan media indicate that the Tripoli-based prime minister and head of the Government of National Unity (GNU), Abdul Hamid Al-Dbeibah, is strongly opposed to Al-Kabir and is attempting to remove him by force.

The ongoing conflict that has led to the creation of two rival governments in Libya has centered around oil revenues, controlled by the western government in Tripoli, and oil production and exports, which are nominally controlled by forces in the east who have the potential to disrupt output, as they have in the past. 

By Charles Kennedy for Oilprice.com

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