The Economist of 3 September has two terrific articles on Algeria and Libya and Libyan oil.
There will be consequences for Algeria’s behavior during the Libyan crisis, although there are signs Algiers is attempting to move away from its sallow neutralism (more on that later).
Algeria’s government is looking especially sheepish. Despite its own revolutionary pedigree and a history of strained relations with Colonel Qaddafi, it voted against the crucial Arab League resolution in March that endorsed NATO’s action in support of Libya’s rebels. It has yet to recognise the Transitional National Council as Libya’s government. Throughout the conflict, unsubstantiated rumours suggested that Algeria supplied the colonel with fuel, arms and transport for foreign mercenaries. When the rebels captured Tripoli, some of them ransacked the Algerian embassy. Others announced that a city square named for Algeria’s revolution would be known as Abu Dhabi Square, in gratitude for the Gulf emirate’s aid.
sustaining long-term production or increasing it to 3m b/d, a target mooted by members of the national council, will need the oil majors to be involved. Several are keen. On August 29th Eni signed an agreement with the national council to supply it with fuel to be paid for in crude. A French trade mission, including Total (as well as a big arms-maker, EADS), is poised to come. British firms have been cagier. The council says it will honour pre-war contracts, but the new Libyan authorities privately admit that firms from countries that helped them in the war will have priority. By contrast, investors from countries friendly to the colonel, such as Algeria’s Sonatrach, may be less fortunate.