Thursday

28th Jul 2016

EU registers first energy shock from Libya unrest

  • An ENI gas installation. The company sent a note to major clients, such as fellow Italian energy firm Edison, warning it cannot guarantee normal supplies (Photo: eni.com)

Italy has been forced to shut down the Greenstream pipeline from Libya, losing 13 percent of its daily gas imports. Regional experts warn that worse is to come.

The Greenstream move on Tuesday (22 February) was made due to safety concerns for Italian energy firm ENI's Libya-based workers, which help to operate the 520-km-long pipeline out of the Libyan port of Mellitah to Gela in Sicily.

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Italy's economic development minister Paolo Romani told reporters Rome will hold a crisis meeting on Wednesday but said there is no risk of energy shortages. ENI said it can draw on extra supplies from Algeria, Norway and Russia. A European Commission spokeswoman added: "There's a lot of gas on the market ... There is enough gas to supply to households and also to companies."

Several other energy companies, including BP, Repsol, Shell and the Netherlands' Royal Bam, are also making arrangements to get their workers out of Libya.

Spain is the only other EU consumer of Libyan gas. But the EU is more heavily dependent on Libyan oil. The Paris-based International Energy Association says Libyan oil in 2010 accounted for over 20 percent of imports to Austria, Ireland and Italy, around 15 percent to France and Greece, over 10 percent to Spain and Portugal and around 8 percent to Germany and the UK.

The unrest has already seen world oil prices jump upward. A worrying report on the US weekly Time magazine's website on Tuesday indicated that the situation could drastically deteriorate.

Time's intelligence columnist, Robert Baer, a former CIA field officer in north Africa and the Middle East, wrote: "A source close to the Gaddafi regime I did manage to get hold of told me the already terrible situation in Libya will get much worse. Among other things, Gaddafi has ordered security services to start sabotaging oil facilities. They will start by blowing up several oil pipelines, cutting off flow to Mediterranean ports. The sabotage, according to the insider, is meant to serve as a message to Libya's rebellious tribes: It's either me or chaos."

"Two weeks ago this same man had told me the uprisings in Tunisia and Egypt would never touch Libya," Mr Baer noted in a caveat.

Italy and Malta are on the front line of the EU reaction to Libya due to their proximity and historical ties. Both countries, along with Cyprus, are opposed to Finland and Germany's recent call for diplomatic sanctions against Libya.

Italy's Ansa news agency says that Italian leader Silvio Berlusconi called Libya's Moammar Gaddafi on Tuesday to assure him that Libyan protesters were not armed with Italian-made rockets, an accusation Mr Gaddafi had made on TV. A Maltese diplomat told the Times of Malta: "Twenty-five countries are objecting [to EU sanctions] and only two are in favour of sanctions."

For her part, EU foreign affairs chief Catherine Ashton on Tuesday said she has frozen talks on a basic EU-Libya trade pact.

The four EU countries on the UN Security Council - France, Germany, Portugal and the UK - the same day signed up to a resolution which says: "They underscored the need to hold to account those responsible for attacks, including by forces under their control, on civilians."

UK Prime Minister David Cameron suggested that in future, the EU should cut off aid to countries that violate democratic values. And EU commissioner Michel Barnier said the bloc should build a "common agricultural market" in north Africa to alleviate social tension linked to food prices.

Behind the high-level debate, EU countries are stepping up their evacuation efforts.

Bulgaria and Italy each have around 1,500 nationals stuck in Libya, with government and military jets sent in to extract them.

France sent three military planes on Tuesday and said it has 500 nationals keen to leave. Germany is boosting commercial flights and gave a figure of 400 citizens. Greece for its part is sending passenger ships to Tripoli and says it has 300 nationals. The Netherlands sent a naval frigate to fetch out its 100 or so souls.

A Portuguese military plane took 84 citizens out on Tuesday, but 56 more are waiting. And the UK has sent a warship to the region to support its repatriation effort, saying a "few hundred" Brits are marooned in Tripoli airport.

EU confrontation with Poland escalates

The EU commission said there is systemic threat to rule of law in Poland and gave new ultimatum. Poland said commission is "losing its authority".

Merkel faces backlash after killings

The German chancellor faces mounting criticism at home for her refugee policy after asylum seekers carried out several attacks over the last week.

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