For Libya, the Hormuz crisis can be a trap or an opportunity

What the report says

Al Jazeera says Libya’s growing importance in global energy markets could be both a chance and a warning sign as the wider crisis linked to the US-Israel war on Iran pushes Europe and other buyers to look for alternatives. The article argues that Libya, with Africa’s largest proven oil reserves, significant natural gas resources and export routes through the Mediterranean, is better placed than many countries to benefit from higher demand.

The piece also stresses that Libya remains internally fragile. It describes a country that exports hydrocarbons while still facing frequent power cuts, heavy fuel subsidies, limited refining capacity and large volumes of gas being flared instead of captured. Al Jazeera cites declining gas exports in recent years and says political division and insecurity continue to disrupt production, limiting how far the country can turn resource wealth into broader economic stability.

The author argues that simply producing and exporting more oil and gas would risk repeating Libya’s long-running “resource curse.” Instead, revenues should be used to improve electricity generation and transmission, capture wasted gas, expand refining where practical, reform subsidies and invest in renewables. The article notes Libya’s target of reaching 22 percent renewable electricity by 2035, though it says that would require better security and governance.

The report also points to new foreign interest after Libya’s first major licensing round since 2007, with companies including Chevron, Eni, QatarEnergy, Repsol, MOL, Aiteo and TPAO securing licences. It says Libya could use this attention to build regional energy partnerships with Egypt and Tunisia, but should avoid becoming dependent on any single outside partner. The broader message is that Libya has a rare opportunity to reposition itself as a Mediterranean energy hub if it pairs investment with domestic reform.