Oil Interests and Libya’s Protracted Civil War:

The Elusive Path to Overcoming State Fragility

Jeongmin Seo 

Director, HIMEA

The ongoing political chaos and protracted low-intensity civil war in Libya—a state that has effectively descended into a failed state—can be understood as the result of four interrelated variables. These include: the lack of historical and cultural identity, the deterioration of socio-economic conditions, the external factor of foreign intervention, and the internal power struggle over oil interests following the civil war.

While all these factors have contributed to Libya’s instability to varying degrees, the prolonged internal struggle for resources and influence—particularly over vast oil wealth—constitutes the most fundamental driver of the country’s enduring disorder. At the core of this conflict lies an ongoing contest for control over Libya’s massive oil interests. In essence, the persistence of political instability since the collapse of the Gaddafi regime in 2011 stems from the deep-seated conflicts among domestic factions over oil-related gains during the process of national reconstruction.

While all of these factors have contributed to Libya’s persistent instability, the prolonged internal struggle for control of oil interests represents the most fundamental driver of the country’s fragility. Beneath this lies a fierce contest for vast oil resources, which continues to shape Libya’s internal dynamics.

In essence, the prolonged political instability that has marked Libya’s post-2011 reconstruction process, following the collapse of the Gaddafi regime, stems largely from domestic conflicts over oil concessions and political dominance.

The Collapse of Fragile States and the Breakdown of People’s Livelihoods

The Libyan people achieved a regime change in 2011 by overthrowing Muammar Gaddafi through anti-government protests, popular resistance, and international support. However, the subsequent process of national normalization revealed deep disorder, leading to a sharp decline in political stability. In particular, due to the fierce confrontation between the Tripoli-based Government of National Accord (GNA)—recognized by the United Nations and the international community as the legitimate government—and the Libyan National Army (LNA) led by retired General Khalifa Haftar in the east, Libya has fallen into a state of low-intensity civil war.

The warlord factions in the eastern region, which had led the initial uprisings and resistance, have refused to accept the internationally supported political framework and continue their armed struggle in an effort to seize political dominance and control over various interests. Under these circumstances, irregular oil exports and the decline in international oil prices have caused a sharp reduction in government revenue, further deteriorating the living conditions of ordinary citizens. Moreover, the policies and attitudes of major Middle Eastern countries surrounding Libya are diverging based on their respective strategic, political, economic, and ideological interests—intensifying the overall instability and confusion in the region.

Deficiency in Historical and Cultural Identity

In terms of national identity for state integration, Libya has historically exhibited weak homogeneity in both its tribal and ethnic composition. Geographically and historically, Libya is divided into three major regions: Fezzan in the south, Tripolitania in the west along the Mediterranean coast, and Cyrenaica in the east. Even under Ottoman rule before Italy’s invasion of Libya in 1911, these three regions functioned as separate administrative entities.

After independence, the division among the three regions remained in place until the administrative reform of 1963, which reorganized the country into ten provinces. Nevertheless, the regional identities of these three areas never completely disappeared and have reemerged clearly since the fall of the Gaddafi regime.

Worsening Socio-Economic Conditions

Among the factors behind Libya’s prolonged instability are the sluggish pace of economic recovery and the slow restoration of social infrastructure. As a country whose economy is heavily dependent on oil, Libya’s ongoing civil conflict since the regime change has severely damaged the oil industry, resulting in stagnation of economic development and a decline in the government’s fiscal capacity. Consequently, economic hardship and social disorder have shown little improvement.

In the midst of political turmoil caused by the civil war, widespread tax evasion has further reduced government revenues, leading to a vicious cycle in which economic difficulties fuel continued political instability. The combination of prolonged conflict, declining fiscal capacity due to tax evasion, reduced investment in industrial and social infrastructure, rising youth unemployment, and the persistence of violence represents challenges that Libya is unlikely to overcome in the short term.

Foreign Intervention Driven by Competing Interests

The situation in Libya is also closely linked to the involvement of various external powers. Although the United Nations (UN) and the international community support the Government of National Accord (GNA), which was established under the Libyan Political Agreement (LPA) signed by multiple factions in late 2015, several major powers and neighboring countries have been covertly backing either the western-based GNA or the eastern-based Libyan National Army (LNA) in pursuit of their own strategic and economic interests, thereby seeking to expand their influence over Libya.

While most Western nations—except for France—along with regional actors such as Qatar and Turkey, support the GNA, countries like Russia, Egypt, the United Arab Emirates (UAE), and Saudi Arabia back the LNA. This division has stalled mediation and stabilization efforts led by the UN and the European Union (EU). As a result, the Libyan conflict has already become internationalized due to the political and military interventions of certain Western powers and regional states. Since the core interests and policy goals of these external actors are unlikely to change in the short term, there is a grim outlook that Libya’s East–West confrontation has evolved into a proxy war, making the continuation of the civil conflict highly probable.

An Ongoing Confrontation among Domestic Factions

The power struggle among internal factions in Libya—particularly between the warlords of the eastern and western regions—remains a major obstacle that is difficult to overcome. This issue is closely tied to the first variable: regional and tribal identity. The deeply rooted tribalism of Libya’s nomadic society was even utilized by Muammar Gaddafi to bolster his legitimacy, as seen in his public performances of traditional tent-dwelling life.

The problem, however, is that tribalism is not merely a question of identity. Major tribes in Libya possess their own armed militias and have engaged in violent clashes with rival groups to expand their vested interests and privileges—becoming one of the key factors behind the prolonged civil war. Tribal warlord factions, each entrenched in different regions, have undermined Libya’s state-rebuilding process, and the long-standing “winner-takes-all” tradition makes the adjustment of competing interests exceedingly difficult.

As a result of the persistent rivalry between eastern and western tribal warlords, no space has been allowed for the emergence of a genuine civil society in post-Gaddafi Libya. Consequently, both political and economic reforms have faced severe deadlock, leaving the country mired in a state of systemic crisis.

The Problem Centers on Oil Interests

The confrontation between Libya’s eastern and western regions is driven by multiple factors, including competition for political dominance and the persistence of tribalism. Yet, at its core lies a struggle over the control of oil resources. Due to Libya’s highly oil-dependent industrial structure, crude oil exports constitute the country’s most critical source of government revenue and national income. Accounting for about 3% of the world’s proven oil reserves, Libya’s petroleum sector represents roughly 90% of its government revenues and exports as of 2024.

Consequently, securing control over oil resources is an essential prerequisite for any faction aspiring to hold political power and ensure effective state governance. Libya also possesses numerous oil fields with significant potential for future development, as well as several currently inactive wells that could substantially boost production. Therefore, the ruling faction that gains control over these oil fields could, in principle, reduce the country’s unemployment rate—around 20% as of 2024—and stabilize the national economy.

The problem, however, is that Libya’s vast oil wealth—the largest on the African continent—is unevenly distributed across the country. While some oil is produced along the northwestern coast and offshore areas near Tripoli, approximately 95% of Libya’s total reserves are concentrated in the Sirte Basin in the east and the Murzuq Basin in the southwest. The eastern warlord factions’ defiance of the UN-recognized Tripoli-based government is largely due to their control over the so-called “Oil Crescent,” a region rich in petroleum resources. The city of Sirte, located between Tripoli and Benghazi, once served as a stronghold for Islamist forces, who were able to thrive thanks to oil revenues from nearby fields. In a last act of desperation, the Islamic State in Libya (IS-Libya), driven out by eastern militias, attacked and shut down the Mabruk oil field, underscoring the centrality of oil in the ongoing conflict.

Moreover, European powers such as Italy and France, which import significant amounts of Libyan oil, have been actively involved in mediation efforts primarily to ensure a stable oil supply. In the ongoing power struggle among various factions—particularly between the eastern LNA (Libyan National Army) and the western militias around Tripoli—the LNA has been steadily gaining the upper hand. It has subdued Islamist militias in Sirte and captured the strategic southern hub of Sabha. With control over former Gaddafi-era armories and military support from the UAE, Egypt, France, Saudi Arabia, and Russia, the LNA now controls roughly two-thirds of Libyan territory, including most of the country’s key oil fields.

Many scholars argue that the prolonged civil war and instability in Libya are fundamentally rooted in this competition over oil interests. Given that the LNA currently dominates most of the oil-producing regions, many observers predict that it is poised to emerge as the ultimate victor. Repeated attacks have revealed that the LNA’s current focus lies on Tripoli International Airport and the western port cities, as it seeks to expand and streamline oil exports. These efforts have already yielded results: the LNA has been exporting crude oil through eastern export terminals, generating substantial fiscal revenues, and in March 2025, it restored the Mabruk oil facilities—destroyed by Islamist forces in 2015—and resumed production after ten years.

Through this growing oil export capacity and expanding financial base, the LNA is increasingly positioned to become the central force shaping Libya’s future political reorganization and national reconstruction.