A recent ceasefire agreement and ongoing political reconciliation negotiations between Libya’s warring factions have significantly de-escalated tensions. A flurry of diplomatic engagement, with significant international support, has raised hopes that the Libyan conflict is about to enter a new stage, namely one that involves less fighting and more talking.

Members of the self-styled Libyan National Army (LNA) and the Government of National Accord (GNA) met in September in Hurghada, Egypt, to discuss a ceasefire for the first time since the early months of 2020, culminating in the October 23 agreement on a comprehensive ceasefire. This deal included provisions calling for the departure of all foreign fighters from Libya within three months, a freeze on military agreements with foreign parties, the demilitarization of the conflict’s frontlines (Sirte and Jufra districts) and the establishment of a joint policing force to monitor and secure the demilitarized frontlines.

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Military talks have advanced alongside parallel political dialogue, which has also seen progress over recent months. Political talks have been held between members of the GNA and the Tripoli-based consultative body, the High Council of State, on one side, and the Tobruk-based House of Representatives, which is aligned with the LNA, on the other side. Meetings between these actors — which have taken place on September 6 in Morocco, September 7-9 in Switzerland and October 11-13 in Egypt — are focusing on reaching an agreement on creating a new presidential council to govern Libya, setting a date for parliamentary elections and more broadly reunifying the country.

The aim of the ongoing political dialogue, under the auspices of the UN, is to reach an agreement on these issues at the summit in Tunisia that began on November 9. However, the prospects of the conflict ending and the reunification of the country taking place in the coming year remain unlikely.

Less Fighting, More Talking

The progress of the political and military negotiations has been bolstered by the September 18 agreement between GNA Deputy Prime Minister Ahmed Maiteeq and LNA interlocutors to ease the nationwide oil blockade that the LNA had imposed since January this year. This agreement has been slowly implemented in Libya since the end of September, and oil production has risen from a low of approximately 100,000 barrels per day (bpd) to 1 million bpd on November 7. The blockade had been a major grievance for the GNA since oil exports account for more than 90% of Libya’s state revenues. The blockade had cost the state at least $9 billion in revenue.

These political and military talks are a positive step forward for the country, which had been in the midst of intense fighting just a few months ago. However, a comprehensive peace deal is not just over the horizon. This ceasefire is only the latest attempt to stop the fighting; the most recent ceasefire deal of January 11 collapsed within weeks of being signed. Moreover, efforts to build trust between the LNA and GNA will be difficult, and neither party is currently willing to sever their lifelines to key foreign backers or force them to leave the country.

The GNA was only able to win the Tripoli battle because of the military support it received from Turkey, including the thousands of Syrian fighters deployed by Ankara. Just days after the ceasefire was agreed, the GNA signed a memorandum of understanding on security cooperation with Qatar in a move that undermines the spirit, if not the letter, of the ceasefire agreement. The GNA remains weary of the LNA and its leader Khalifa Haftar after the general launched the attack on Tripoli in April 2019 just days before a planned UN peace conference. There are also constituencies among the militia groups that make up the GNA’s armed forces that are resisting the ceasefire and broader military negotiations with the LNA.

Meanwhile, the LNA has its own reasons to resist adhering to certain aspects of the ceasefire agreement. The LNA’s dependence on Russian and Emirati military, financial and political support has increased over the past year, and Russian private military companies aligned with the LNA are also present in the country. The LNA will not want to remove foreign forces, which provide important military support, from the country. Moreover, it is likely that Haftar is merely biding his time with this ceasefire, de-escalating tensions while allowing oil revenues to flow back into the system to appease the growing number of Libyans who are exasperated by the country’s sharp economic deterioration.

General Haftar maintains the intent to rule Libya. However, he does not currently have the ability to impose his will by force, especially while the GNA has strong Turkish backing. Haftar will thus present a major obstacle to a comprehensive end to the conflict — unless he is effectively sidelined. This remains unlikely over the coming months since Haftar retains significant support of key tribal constituencies and because his interests remain aligned with those of his international backers.

Back in Business

While a total end to the conflict very likely remains out of reach in the coming months, the de-escalation in fighting has opened opportunities for business. The country, and particularly the state-owned General Electricity Company of Libya (GECOL), is in significant need of upgrades and repairs to power infrastructure. At the moment, GECOL is producing around 4,500 MW, but peak demand stands at around 7,000 MW. The end of the battle for Tripoli in June and the limited progress in military and political talks have created conditions that are allowing international firms to restart power projects. Moreover, the resumption of oil exports will generate government revenues that will make it possible to start additional projects.

Business confidence in the oil and gas sector is also rising as operations are beginning to ramp up. Nuri Esaid, chairman of Tripoli-based Akakus Oil Operations, said on October 31 that the Sharara oilfield in Libya’s southwest will pump 300,000 bpd by the end of 2020, following the decision by Libya’s National Oil Corporation (NOC) to lift force majeure at the field on October 11. The NOC also lifted force majeure at Sidre and Ras Lanuf oil export terminals on October 23, removing the final barriers to ramping up oil production nationwide. Businesses with operations in the country will cautiously seek to restart projects that have been regularly disrupted over the past years.

Nevertheless, the operating environment remains fraught with risk. Companies must balance their relationships with both the LNA, which has physical control over most of the country’s oil and gas installations, and the GNA, which nominally controls all key state institutions, such as Libya’s central bank and the NOC. There are also security challenges arising from the presence of local Petroleum Facilities Guards that often have their own interests. In December 2018, for example, the Fezzan Rage Movement worked with members of the guards to shutdown the Sharara oilfield to demand greater government economic support for southern Libya.

Local grievances in the southwest over lack of economic opportunity and government support, as well as tribal divisions, especially between local Tebu and Tuareg groups, in the area will sustain threats of unrest and communal violence. Moreover, the Islamic State is still present, if diminished, in central Libya and capable of launching small-scale attacks. Sustained political fragmentation will contribute to the continuation of longstanding security deficiencies as the country’s rival authorities will fail to adopt a unified, cooperative approach to country-wide security. As progress toward a more comprehensive political settlement stalls, the prospect that Khalifa Haftar will reimpose an oil blockade — and reignite the conflict — will grow.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.