Game Theory : US Sanctions on Libya

Essay by DatsVergUniversity, Bachelor'sA+, August 2006

download word file, 5 pages 3.9

On April 5, 1999, more than 10 years after the 1988 bombing of Pan Am flight 103 over Lockerbie, Scotland that killed 270 people, Libya extradited two men suspected in the attack. In response, the United Nations suspended economic and other sanctions against Libya which had been in place since April 1992. In late April 2003, Libya's foreign minister stated that Libya had "accepted civil responsibility for the actions of its officials in the Lockerbie affair," and in September 2003 the UN Security Council officially lifted its sanctions. On February 26, 2004, following a declaration by Libya that it would abandon its weapons of mass destruction (WMD) programs and comply with the Nuclear Non-Proliferation Treaty (NNPT), the United States rescinded a ban on travel to Libya and authorized U.S. oil companies with pre-sanctions holdings in Libya to negotiate on their return to the country if and when the United States lifted economic sanctions.

On April 23, 2004, the United States eased its economic sanctions against Libya, with a written statement from the White House Press Secretary stating, "U.S. companies will be able to buy or invest in Libyan oil and products. U.S. commercial banks and other financial service providers will be able to participate in and support these transactions." On the same day, Libya's state-owned National Oil Corporation (NOC) announced its first shipment of oil to the United States in over 20 years. On June 28, 2004, the United States and Libya formally resumed diplomatic relations, severed since May 1981. Finally, on September 20, 2004, President Bush signed Executive Order 12543, lifting most remaining U.S. sanctions against Libya and paving the way for U.S. oil companies to try to secure contracts or revive previous contracts for tapping Libya's oil reserves. The Order also revoked any restrictions on importation...