(Updates with security forces comment in second paragraph.)
Oct. 10 (Bloomberg) -- The abduction of Libya’s Prime Minister Ali Zaidan marks a period of just over a year in which the U.S. ambassador was killed, the French and Russian embassies were attacked, military officers were assassinated and oil output slumped. Security won’t improve any time soon.
Zaidan was freed hours after he was held by the country’s anti-crime unit at a Tripoli hotel and went back to his office, the state-run Libyan News Agency reported. Abu Bakr Abdel-Qader, a member of parliament’s national security committee, said the premier’s detention today amounted to “a military coup,” the Press Solidarity news service cited him as saying. Zaidan’s abductors wrongly believed that a warrant had been issued for his arrest, said Hashem Beshr, head of the Supreme Security Committee for Tripoli.
“If you want to be taken seriously by the government and get your demands listened to, the message being sent is that you have to be in control of an important asset or person,” said Firas Abi Ali, head of Middle East and North Africa analysis at political risk company IHS Country Risk, in an interview. “There is no reason to believe the government’s control over the country will improve over the next year. This is becoming more and more of a vicious cycle.”
Libya enjoyed a burst of unity after the 2011 NATO-backed war that ousted Muammar Qaddafi and during the first fully democratic vote in more than 50 years a year later. Since then, militias from Benghazi, Misrata and Zintan, who led fighting against Qaddafi, have been using force to exact political concessions and to seek a looser federation. Radical Islamists have meanwhile been attempting to carve out a base in the east.
Britain’s Prime Minister David Cameron spoke to Zaidan after his release and found him “calm and very measured throughout the call,” according to the Downing Street spokesman. Secretary of State John Kerry said told reporters in Kuala Lumpur that American embassy personnel are secure and “we’re confident about our abilities to keep them in that security.”
Brent crude for November settlement rose 1 percent to $110.10 a barrel on the London-based ICE Futures Europe exchange at 5:33 p.m. in Dubai.
The group that held Zaidan denied reports the abduction was a response to a U.S. military operation this week that seized alleged al-Qaeda fugitive Abu Anas al-Libi, who was detained in a Tripoli suburb.
Abi Ali said the U.S. action probably contributed to Zaidan’s detention, “then the various groups involved realized that linking the capture of the prime minister to the capture of a terrorist put them in a bad light.”
It’s not the first time Zaidan has been targeted. About 30 militiamen attempted to storm his office in Tripoli in March and were thwarted by Interior Ministry security forces.
“The government is in real trouble,” said Faraj Najem, a Libyan political analyst, who teaches at the University of Benghazi, in an interview from Tripoli. “There is money going around, there are plenty of homes, weapons, so people feel empowered and that’s dangerous.”
The decline of security in Libya was starkly illustrated by the death of the U.S. ambassador to the country and three other Americans in Benghazi on Sept. 11, 2012, as militiamen assaulted the consulate.
Since then, oil production has slumped to an average of 300,000 barrels a day last month, the lowest since the 2011 war, oil ports have been closed by strikes, half the French embassy was destroyed by a car bomb in April, a jail break freed 1,200 prisoners from Benghazi prison in July, a police colonel and a retired air force officer were murdered the same month and Russia’s embassy was attacked by armed men last week.
“When Zaidan came to office, he was seen as taking a hard line against militias and people liked him but then he realized he doesn’t have the power required to deal with them,” IHS Country Risk’s Abi Ali said. Now, Zaidan is seen as unable to conciliate or confront the militias, he said.
In May, the militias showed their power by surrounding government ministries for two weeks and forcing the passage of a controversial law to purge senior Qaddafi-era officials from office. Since July, protesters in the east have shut down oil terminals, demanding better pay and jobs, and eventually calling for Zaidan’s ouster, accusing his government of corruption.
Libya’s economy may expand 0.7 percent this year, HSBC said in a report this week, compared with a forecast of 15.9 percent three months ago, after the oil protests. The oil and natural gas industry, which makes up more than 70 percent of Libya’s economy, generates almost all the state’s revenue.
The unrest has also delayed the drafting of a new constitution and elections for a permanent government.
The best scenario would be for a federal constitution that designates militias as police forces held accountable by regional authorities, with the central government devolving power to the regions, Abi Ali said. Making them part of the central government has already failed.
One of the worst scenarios would see foreign energy companies starting to withdraw, cutting the pool of security contracts at oil installations, hitting militia incomes and increasing the risk of inter-group fighting, Abi Ali said. That in turn would force more foreign companies to leave.
“The longer the political deadlock continues, the more the likelihood that this becomes the scenario,” he said. “This would also prompt the east to try to secede, though there’s no guarantee that this would succeed.”
--With assistance from Mariam Fam in Cairo, Dana El Baltaji in Dubai and Thomas Penny in London. Editors: Francis Harris, Mark Williams