A Libyan military personnel mans a checkpoint in the city centre in Benghazi December 4 2014, where clashes between pro and anti-government forces have taken place

The divisions opened up by Libya’s civil war have left it not only with two governments fighting for power but also with rival central bank governors — paving the way for a potential struggle over control of oil revenue and foreign currency reserves.

The central bank in Tripoli is run by Saddek Omar El-Kaber, even though he was sacked as governor in September by the internationally recognised parliament, which has since fled to Tubruq in the country’s east.

Mr El-Kaber, who is fighting his dismissal in the courts, has continued to disburse state salaries and subsidies across Libya but has blocked other spending from the budget that was agreed before the government split.

The Tubruq parliament has appointed Ali Hibri, the former deputy bank governor, to replace Mr El-Kaber, but Mr Hibri has no access to national financial assets, which are still managed in Tripoli, the capital.

Rival claims over national institutions, taking place against a backdrop of fighting across the country, threaten to push the country to the brink of breaking up.

“It is very difficult for the government [in the east] because there are no funds,” said Abdul Salam Nasiya, the head of the Tubruq parliament’s financial committee. “We can’t go on like this next year, when we will have to have a new budget. Hibri has promised parliament he will take steps to transfer the accounts.”

Mr Hibri told the Financial Times he aimed to regain control over the oil revenue account by January if no “consensual formula” with Tripoli, which is in the hands of the Islamist-leaning Libya Dawn alliance, was found.

Yet while he played down the difficulties of getting access to the account, Mr Hibri acknowledged that taking action could provoke a strong response from Tripoli. “The transfer of revenue will be very easy, but we are studying the reaction of the other side,” he said. “You can expect anything, so your security side must be strong. If we seize assets, the war may be fuelled. We are careful to the maximum extent.”

To fund itself in the final quarter of 2014, the Tubruq government has sold LD3bn ($2.3bn) of Treasury bills to local banks, he said.

Libya map

However, banking services in the east of the country are minimal because of the break with Tripoli, according to Jamal Abdel Malek, chairman of the privately owned Bank of Commerce and Development.

“The central bank in the west has every­thing and the one in the east has nothing,” he said. “Our branches in the east can make limited transfers, such as through Western Union, which do not go through the central bank in Tripoli. We send emails, but in the west they [the bank] do not respond and the central bank of the east doesn’t have enough funds.”

Western diplomats eager to prevent Libya from breaking up have been anxious to see how the two sides deal with the central bank and other institutions such as the Libyan Investment Authority, the sovereign fund, and the National Oil Company.

Bernardino León, head of the UN support mission in Libya, announced possible peace talks between the forces loyal to the Tubruq and Tripoli authorities last week, although neither side has yet pledged to attend.

“We’re certainly encouraging both sides not to exploit these institutions,” said a western diplomat. “I think one of the things that will come out of the UN discussions is agreement on [the organisations].”

As with the central bank, the LIA and NOC each have rival chiefs. According to the diplomat, the two heads of the LIA met by chance when they found themselves in the same London hotel recently.

The NOC chief appointed by Tubruq attended last month’s Opec meeting in Vienna, while his Tripoli-based rival, who still oversees the country’s oil sector and deals with international oil companies, was barred.

$135

The price for a barrel of oil Libya needs to balance its budget - double the current price

International officials and other observers warn that Libya could burn through its considerable wealth if it remains at war with itself. Oil production at 800,000 barrels a day is half of the 1.6m bpd the country once produced and depressed oil prices are making it necessary to dip into reserves to plug a budget deficit that has ­ballooned to half of gross domestic product.

The price of failing to find an agreement is likely to be high. “There is a sense of uncertainty over who is actually governing Libya.” said Mohamed Eljarh, a Libyan analyst and non-resident fellow at the Atlantic Council. “But there are those on both sides who understand that [Mr] León’s efforts should succeed because if there is no consensual power-sharing agreement, the alternative is to lose everything.”

“Every decline in oil prices by 10 per cent will increase the budget deficit by 2 per cent,” said Mohammed El Qorchi, the International Monetary Fund mission chief for Libya. He reckons the country needs an oil price of $135 a barrel at current production levels to balance its budget, which was $47bn this year.

On Monday, the price stood at $67.55 a barrel.

Currency reserves were a little above $100bn in August, according to IMF figures, down from $121bn at the beginning of the year.

“If they continue with what they are doing and the conflict persists, reserves will be depleted in four years,” said Mr El Qorchi.

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