Libya shifts from Russian fuel to Western suppliers

Major international oil traders have secured new contracts to supply fuel to Libya, signalling a shift in the country’s energy strategy and a move away from reliance on Russian imports.

Tenders awarded in recent weeks give some of the world’s largest oil trading houses a central role in meeting Libya’s gasoline and diesel needs, as the country restructures how it buys fuel and sells crude, as reported by Reuters on February 19.

Whilst holding the title for the most proven oil reserves in Africa, Libya continues  to rely heavily on fuel imports whilst also suffering from widespread fuel shortages. It is estimated that up to 70% of Libya’s imported fuel is funnelled through entities and individuals without the legal entitlement to do so.

Reports have exposed the extent of Libya’s state-linked fuel smuggling, some estimates indicate that that from 2022 to 2024, state-linked smuggling drained roughly $20 billion from Libya’s economy.

Libya is in the process of rebuilding its oil sector after more than 15 years after the fall of Muammar Gaddafi, following the NATO-backed uprising in 2011. Although the country produces about 1.4 million barrels per day of crude oil, limited refining capacity means it must import most of its fuel. Authorities are now seeking to modernise the system, after launching upstream licensing rounds for the first time in two decades to lift production towards 2 million barrels per day.

The crude-for-fuel swap system that the National Oil Corporation (NOC) had previously employed dramatically increased imported refined fuel, which continues to be siphoned off by state-linked criminal networks. This dynamic, in which Libya became dependent on exporting raw materials, importing the finished goods, whilst relying on foreign investment, is evocative of the colonial-era exploitation that many resource rich countries from across the global south have continued to face since the end of formal colonial rule.

Instead of exchanging crude exports for fuel imports, under the new agreements with Western oil firms and traders, Libya has begun awarding stand-alone fuel supply tenders.

Without strong and unified state institutions however, imported fuel to Libya, whether coming from Russian or Western companies, will continue to face the same fate of falling into illicit networks due to corruption, weak governance and poor regulatory oversight.

According to three traders familiar with the results, Vitol won the right to deliver between five and ten gasoline cargoes a month, alongside diesel volumes. Trafigura and TotalEnergies also secured supply contracts, although exact quantities were not disclosed.

Libya’s state-owned National Oil Corporation also awarded fuel tenders to OMV, Swiss trader BGN and Italian refiner Iplom, according to an NOC source.

The shift is accelerating a decline in Russian fuel supplies. Data from analytics firm Kpler shows Russian exports to Libya falling to around 5,000 barrels per day in 2026, down from 56,000 barrels per day in 2024–2025. Italy has emerged as Libya’s largest supplier this year, providing about 59,000 barrels per day, largely from Mediterranean refineries operated by Vitol and Trafigura.

Reuters, Libya Review, Maghrebi.org