The brother of Ibrahim Jathran, who has been leading the blockade of crude oil exports from Libyas eastern oil ports, has been arrested in Dubai on charges of oil smuggling.
Khalid Jathran was held after the Libyan government issued a red notice to the international police agency, Interpol for his arrest, according to Reuters news agency.
Jathran has been released on bail, but his extradition process to Libya is now underway. Members of Ibrahim Jathrans federalist movement rejected the charges and accuse the Libyan government of using the arrest to put the group under pressure.
Having recovered to 1.4 million barrels a day (b/d) from almost zero in 2011, Libyas oil production fell dramatically in 2013, as the sector was plagued by strikes and protests at production and export facilities since last June.
Oil production rose to 530,000 b/d in January 2014 from 250,000 b/d at the end of 2014 after the restart of production from the Sharara oil field, one of Libyas largest onshore fields. But production has since been cut by 40 per cent after an armed group forced the closure of a pipeline to the 230,000 b/d Zawiya refinery, Libyas second largest export facility.
A former member of the governments Petroleum Facilities Guards, Ibrahim Jathran is at the centre of the federalist movement in eastern Libya and controls around 600,000 b/d of Libyas export capacity, around half the countrys total. His forces have attempted to secure revenues by selling crude oil, but so far the attempts have been unsuccessful as buyers are wary of purchasing crude oil without the sanction of the government.