The violence roiling Libya has increasingly targeted oil companies and their assets, upending long-term investments by Western companies and driving down production in a country that helped trigger the world-wide rout in oil prices.

In short order, Libyan oil output has fallen to about 325,000 barrels a day in January from nearly 900,000 barrels a day in October, largely because of oil fields being taken over by Libyan militias or shutdowns due to security concerns, according to officials at the state-owned National Oil Co.

The plunge in production comes after civil war broke out mid-2014, leading to two big closures at the end of the year. […]