Local media blamed Tuareg fighters acting on behalf of the Islamist militias allied to the city of Misurata who control the capital, Tripoli, and much of western Libya.
The Islamist militias are, in turn, supported by Qatar, the oil and gas-rich Gulf state. A conflict that Qatar stands accused of inflaming has now spread from Tripoli to the desert wastes of southern Libya.
The United Arab Emirates has lined up behind the non-Islamist forces who oppose Qatar's allies. The UAE and Egypt jointly support a coalition between Libya's elected Parliament, which has been ousted from Tripoli and now meets in the city of Tobruk, and a rogue general, Khalifa al-Haftar. The Islamist militias can also count on the backing of Turkey as well as Qatar. With the fall of Al-Sharara oilfield, the Qatar-backed militias may follow up their success by attempting to seize other centres of Libyan oil production, whose funds find their way to all factions in the country's conflict.
The Libyan Central Bank, which receives all revenues from oil exports, is paralysed by demands for the distribution of the money.
But even leaving aside the attack on Al-Sharara, this was another disastrous week for Libya, the scene of the Anglo-French intervention in 2011 which helped local rebels to bring down Colonel Muammar Gaddafi. Since then, the Western powers have favoured the anti-Islamist bloc, recognising the elected Parliament as Libya's legitimate governing body, even though its members must live on a cruise ship moored off Tobruk.
The Libyan Supreme Court - which is still based in Tripoli - ruled this Parliament to be illegal, noting how it was chosen in June during an election with a turnout of just 20 per cent. Unsurprisingly, the Parliament rejected the judgment, saying it was made under duress thanks to the "force of arms" of the Islamist militias controlling the capital.
But that still leaves Libya torn between two rival assemblies, thanks to a decision by the old Parliament, which was dissolved in June's election, to reconvene itself in Tripoli. Each of the opposing Parliaments has, in turn, chosen an administration. Libya has duly been landed with two governments. If this was a sign of Libya's internal turmoil, there was more evidence of the failure of outside efforts to help. Britain tried to build up Libya's legal security forces by taking hundreds of militia fighters to Bassingbourn Barracks in Cambridgeshire, where the Army did its best to turn them into proper disciplined soldiers. Now they are all being sent home in disgrace after dozens simply absconded - and others were guilty of sexually assaulting local women.
Small wonder that British Prime Minister David Cameron has said little about Libya since his triumphant appearance before cheering crowds in Benghazi to celebrate Gaddafi's downfall in 2011. That restraint seemed to extend to the Prime Minister's meeting with the new Emir of Qatar, Sheikh Tamim bin Hamad al-Thani, in Downing Street last month. Afterwards, nothing was said in public about the two leaders discussing Libya.
Competing in Libya
Egypt: The country shares a 1125km border with Libya and has a direct national interest in the affairs of its neighbour. Cairo's regime does not want permanent chaos on its western frontier, nor the emergence of a new regional base for radical Islamists.
UAE and Qatar: The Gulf countries have no comparable interests at stake. Instead, their motive for taking sides in Libya's strife appears to be primarily ideological. True to its long-standing policy, Qatar has chosen to back the Islamists. The UAE is helping the other side. Libya's turmoil has become a theatre for competing influence.
