Armed men blew up a Libyan pipeline pumping crude oil to Es Sider port on Tuesday, reducing the North African country's output by around 90,000 barrels a day, military and oil sources said.
The attackers arrived at the site near Marada in two cars and planted explosives on the pipeline, a military source said.
The damage was still being assessed, one oil source said. Oil prices rose on the report.
Islamic State fighters had a presence in the area until government forces expelled them from their main stronghold in Sirte a year ago.
The operator of the pipeline is Waha, a subsidiary of Libya's National Oil Corporation and a joint venture with Hess Corp, Marathon Oil Corp and
ConocoPhillips (COP).
Waha pumps a total 260,000 barrels a day, its chairman said last month.
Libya's oil production was last put by officials at around one million bpd but exact figures are hard to obtain a country riven by factional conflict.
Reporting by Ayman al-Warfalli