The meeting of the Libyan British Business Council in Tunis at which National Oil Corporation (NOC) chairman Mustafa Sanalla set out ambitious plans to increase crude production was also notable for an altercation with Central Bank of Libya governor Sadiq Al-Kebir. Speaking in Arabic at the start of the meeting, Sanalla berated the governor for allowing central bank funds to be dispersed to the armed militias who control Tripoli. The incident encapsulates the tension at the heart of Libya’s civil conflict which is simultaneously a proxy war supported and funded by a variety of external actors, and a dirty fight between local armed groups for control of revenue streams and resources.

Sanalla’s criticism of Kebir can partly be explained by NOC’s difficulties in securing essential funds committed in the budget. There is, however, a deeper problem. So long as hard-earned oil revenues are being stolen and squandered by the militias, NOC’s achievement in keeping the oil flowing is fundamentally undermined. Increasing production may only incentivise more crime and violence.

The criminals who benefit from the failure of the state are not targeting oil production. On the contrary, fields and installations are now left alone so the revenue streams they generate can be pilfered further down the line. By contrast, the central bank and the institutions to which it distributes money are under permanent attack. Along the way, the warring factions have created a devastating moral void. Misappropriated oil revenues are being spent on a hideous drone war which is killing an increasing number of citizens in the capital and its surroundings.

Drones are being supplied to the Government of National Accord (GNA) by its main international backer Turkey, and to the Libyan National Army (LNA) by its backer the UAE. At an earlier point in the conflict there was some hope that these external actors could be corralled by the United Nations or European powers into acceptance of some kind of compromise. This hope is now dead.

The question now being asked is whether the UAE, Saudi Arabia and Egypt – prompted by Presidency Council head Fayez Al-Sarraj’s reckless decision to support Turkey’s redrawing of maritime boundaries in the Eastern Mediterranean – will withdraw their recognition of the GNA and throw their lot in definitively with LNA warlord Khalifa Haftar.  One Libyan political observer predicted that such a resolution at the League of Arab States could be imminent. The reason it has not happened before is it would breach a number of unanimously approved UN Security Council resolutions, including those publicly affirmed by Cairo and Abu Dhabi.

Two key questions are whether Haftar’s drone assault on the capital has brought him close enough to victory to make the UN’s objections irrelevant and whether Sarraj’s blunder into the vital interests of his neighbours has dragged him beyond the pale. A further element is at play. The fuss over the maritime agreement overshadowed an equally important “security and military cooperation agreement” signed by Sarraj and Turkey’s President Recep Tayyip Erdogan at the same time. Libyan interior minister Fathi Bashagha told local media that it was a memorandum of understanding aimed at maintaining security in Libya and protecting the country’s sovereignty. Erdogan’s foreign affairs spokesman Fahrettin Altun described it as a “broader version of our previous military cooperation framework agreement”, adding that it “establishes training and education, structures the legal framework, and strengthens the ties between our militaries”. However, the Libyan political observer told African Energy Sarraj had, in fact, granted the Turkish navy the right to operate in Libyan waters as part of a deal to shore up the defence of Tripoli in anticipation of a final showdown with Haftar’s LNA.