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If you looked for stories on Libya's oil industry after the revolution that ousted Moammar Gadhafi in 2011, you'd find encouraging headlines like these:

Spared in War, Libya's Oil Flow Is Surging Back

Libya rises fast from the ashes

So it seemed Libya's oil industry had survived intact and wouldn't be roiling international markets. As recently as April, the country was producing 1.4 million barrels per day, just a bit off its pre-war levels.

But now the oil sector is crippled by strikes; its crude exports are down to a trickle; and the country is running out of money to pay civil servants.

An Unexpected Hit

Worker strikes in Africa's largest oil producer first began in May, but that labor dispute was quickly resolved.

"It came out of nowhere," says Stuart Elliott, a senior managing editor at Platts, a news organization that covers the global energy sector.

Then in mid-July, armed guards took over the oil terminals in the coastal northeast took that they were supposed to protect. The bulk of Libya's oil is produced in the east. The oil is carried by pipelines to these terminals on the Mediterranean coast and are then exported. But the government no longer had control of the terminals, so production fell, as did exports.

At the same time, tribespeople took control of two fields in the country's south. This meant little oil could flow to the terminals on the nation's northwest coast.

The demands of the strikers and the tribespeople range from more pay, to more jobs to protests over corruption.

"These are two separate groups of people. No one knows who's in charge of what," Elliott says. "It's a double-whammy."

The protests have had their effect: In early September, Libya's output fell to just 150,000 barrels per day, though it has the capacity to produce 1.6 million barrels per day. Exports fell to 80,000 barrels per day.

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