Oil for unity: What is the US mediation plan in Libya?

EXPLAINERThe plan, led by Trump relative Massad Boulos, promises oil investments if rival factions work together. But analysts have doubts about whether it could work.Demonstrators demand the overthrow of Libya's Government of National Unity, headed by Prime Minister Abdul Hamid Dbeibah, in Martyrs Square in Tripoli, Libya, on May 16, 2025 [Ayman al-Sahili/Reuters]Published On 8 Jul 2026Fifteen years after NATO’s intervention in a Libyan uprising set the stage for a prolonged period of chaos and political crisis, the United States is leading a diplomatic push for a reunification plan in the North African country.Led by Massad Boulos, US President Donald Trump’s top adviser on Arab, Middle Eastern and African affairs – he is also the father of Trump’s son-in-law Michael Boulos – the plan aims to turn a growing financial crisis in Libya into an incentive for warring factions to cooperate.Libya has been split between rival eastern and western administrations since a civil war broke out after the 2011 NATO operation helped topple longtime leader Muammar Gaddafi.Here’s what we know about the US plan for Libya:The US is pushing to unify rival factions in Libya.Libya remains politically and militarily split between two primary rival administrations and their allied militias: the United Nations-recognised Government of National Unity (GNU) in Tripoli and an eastern-based administration aligned with Khalifa Haftar’s Libyan Arab Armed Forces, commonly known as the Libyan National Army (LNA).Starting in 2020, most formal mediation has been led by the UN, particularly the UN Support Mission in Libya (UNSMIL), but the US has become a key behind‑the‑scenes broker.In May 2021, it appointed Ambassador Richard Norland as special envoy to Libya to shuttle between rival factions and regional capitals and lead high-level diplomatic efforts in the country.During Trump’s second term, that role has passed to Massad Boulos, whose son Michael is married to the US president’s youngest daughter, Tiffany.“The US is leading a negotiation to create a unified government among Libya’s rival elites,” Tim Eaton, a senior research fellow in the Middle East and North Africa Programme at the London-based Chatham House think tank, told Al Jazeera.“While the US public messaging is that this is about creating an inclusive government, their efforts really hinge on getting the Haftar and Dbeibah families to formally agree to be part of the same government,” said Abdul Hamid Dbeibah, a businessman-turned-politician and the prime minister in the internationally recognised Libyan government.What is the situation in Libya?Beginning on March 19, 2011, a NATO-led coalition, including the US, United Kingdom and France, conducted an air campaign in Libya that provided essential support for rebels fighting Gaddafi’s regime. Gaddafi had been in power since 1969.After rebel fighters captured and summarily killed Gaddafi in October 2011, Libya was left without a viable successor state. This left a power vacuum. Libya has since had multiple competing governments, militias and armed groups.Who are all the different factions and what do they all want?The GNU is based in western Libya and is the official government of the country, recognised by the UN and most countries.Despite that diplomatic recognition, it does not hold sway over vast parts of the country.The Haftar-led LNA controls the east, including the strategically critical port city of Benghazi. It has historically received support from the United Arab Emirates and Russia.With Libya essentially divided, its central bank has been trying to finance two parallel governments.What do we know about the US plan?Boulos has been shuttling to Libya since 2025 early in Trump’s current term. But the details of his plan only became public through an interview he gave to the Financial Times in June.At the heart of the Trump initiative is a promise: If the two warring factions come together to try to jointly govern Libya, the US would encourage its companies to invest in Libya’s massive oilfields. Because the UN recognises the government in Tripoli, any oil deal would need to be signed with it. But it is Haftar’s forces that control the actual part of Libya that is home to its oilfields and terminals. Only if they work together can international investment enter Libya’s oil sector.Meanwhile, the Central Bank of Libya has made it clear that it cannot sustainably continue to finance both governments.That combination of a looming crisis and the promise of an opportunity is what, analysts said, Boulos and Trump appear to be hoping will persuade the two Libyan factions to come together.Leaked details of Boulos’s plan also suggest that the US has proposed a power-sharing agreement: Dbeibah would continue to lead the government while Saddam Haftar, son of Khalifa Haftar and the LNA’s army chief, would in effect serve as president.The US has several motives to mediate in Libya.For one, the country has large oil and gas reserves – the largest proven oil reserves in all of Africa. In January, Dbeibah announced that the country had broken a 12-year oil production record last year, producing 1.37 million barrels per day.“For special adviser Massad Boulos, Libya appears to offer a theatre in which political stability could provide a springboard for increased US commercial engagement in Libya’s oil sector,” Eaton said.“If done right, there is a win-win here, as long-term investment from major international oil companies would benefit Libya.”That oil is also very strategically located. Libya loads its oil on tankers on the Mediterranean Sea that can reach Italy in two days. At a time when the US-Israeli war on Iran and its closure of the Strait of Hormuz has forced the world to consider alternative routes to source energy, unblocking Libya’s resources could help Europe and the West in particular. Libya’s light and sweet grades of oil match what European refineries are best equipped to handle.Ending the crisis in Libya would also serve the West’s desire to curb irregular migration via the country into Europe.“However, the question is whether Boulos’s plan would actually provide the stability needed or whether it will simply entrench deeply flawed powerbrokers,” Eaton said, referring to Haftar and Dbeibah. “Most Libyans see such a deal as no recipe for stability and as a return to family rule.”Eaton said that so far, the most successful element of the mediation between the Dbeibahs and the Haftars has been the agreement of a unified national budget for 2026.This landmark agreement was signed in April, marking the first unified budget in Libya in more than a decade.“Until now, there is, however, no agreement on the formation of a unified government.”It is believed that Saddam Haftar has expressed his support for the initiative. He met with US Secretary of State Marco Rubio in Washington, DC, last week, Eaton said.“But the Dbeibahs have not yet signed up. Such a deal is fraught with risk for them because of widespread opposition to the Haftars in western Libya,” he added.“And, even if they are able to get a deal through, the Dbeibahs would want guarantees that the Haftars will not use the agreement as a springboard to a military takeover of the state. It’s unlikely that the US will provide such a guarantee.”A summary of a proposed “Libya reunification plan” shared with the Reuters news agency sets out a 36-month transitional power-sharing arrangement under a body called the Government of National Consensus and Presidential Council.