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Libyans chant slogans in front of a defaced billboard of Libyan leader Moammar Gadhafi during a demonstration against the regime in Tobruk, eastern Libya.Kevin Frayer

The backbone of Libya's revolt runs out of the shimmering desert and down to the sea, an unbroken network of pipelines, refineries and port equipment that keeps the oil flowing even as the country stands on the edge of civil war.

It's a point of pride among the young revolutionaries in the port city of Tobruk, in eastern Libya, that they resumed oil shipments this week. In recent days three tankers filled with millions of barrels have set off for customers in Europe and China.

Two of the country's largest oil fields, Sarir and Misla, remain connected to Tobruk through several hundred kilometres of pipeline under the control of forces opposed to Moammar Gadhafi. The opposition has shut off the supply from those fields to ports near the town of Surt, which remains loyal to the regime, diverting the oil to endless rows of storage tanks near Tobruk.

"They're revolutionary people, all of the workers," said Mohammed Saleh, an engineer with an oil marketing firm.

The two giant fields south of Tobruk account for about 600,000 of the 1.6 million barrels a day that Libya can produce at full capacity, about 2 per cent of the world's oil supply.

The International Energy Agency estimates the recent violence has cut the country's oil output in half. Those cuts are not evenly distributed. It appears that the rich fields in the east, controlled by the rebels, have suffered reductions in output but continue pumping vastly more oil than the territory held by Col. Gadhafi.

Resistance leaders in Tobruk say this will give them an advantage as the conflict drags into its third week. "When the oil was under the control of Gadhafi, the people got no profit," said Sal Hariri, a local organizer. "With this money we will give a good life to all Libyans."

Foreign analysts have been less optimistic in recent days. "With Libya apparently at risk of civil war, there are reasons to believe that oil supplies in that country could be off for months," Merrill Lynch said in a note. International firms have evacuated their staff by the hundreds, shuttering some operations.

But the mass departure of foreign workers has also given hope to the unemployed young men who participated in the demonstrations. They blame the old regime's corruption, patronage and nepotism for preventing them from getting jobs, and expressed hope that a new government will give them a chance.

"We have huge unemployment," said Haytham al-Bara'si, 37, who trained as an architectural engineer but remains jobless. "We need competition and investment. We need assistance, not military intervention."

Even as the oil flows from this rebel stronghold, the regime continues to insist that it maintains complete control of the industry.

Shukri Ghanem, head of the state-run National Oil Company, said in an interview with the Associated Press on Monday that his firm still has supervision of the oil supply.

"Of course there is a drastic cut," Mr. Ghanem said. "The main reason for the oil production to come down is the panic of foreign labourers, who felt they had to leave. I think all labourers will be safe if they return."

Despite those assurances, Tobruk is awash with rumours of impending violence. Some talk of rebel groups organizing themselves for a final push on Tripoli, while others discuss Col. Gadhafi's latest effort to take back lost ground. Some residents fear that the regime is continuing to bring in planeloads of mercenaries from nearby African countries, such as Niger and Chad.

One anecdote suggested that a plane filled with stacks of money and thousands of Kalashnikov rifles had landed at a remote airstrip on Monday after the pilots disobeyed orders to pick up mercenaries.

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