In early April, 1941, the German force in Libya had pushed back the defending troops. After Richard O'Connor had almost defeated the Italians in Libya, the army in eastern Libya was stripped to provide troops for Greece. O'Connor was ill, but available as a consultant. The one bright spot was east Africa, where Alan Cunningham had conducted a brilliant campaign against the Italian and African colonial army.
The commanders in the Middle East were said to have been concerned about defending against a German airborne attack on Greece, but we have a hard time finding any positive steps that were taken with that defence in mind. Dominion troops just removed from Greece were in Crete and would soon have to fight the Germans again, under even more difficult circumstances.
But it was in North Africa, in Cyrenaica (eastern Libya, that the situation had grown critical. The small German force sent to Libya was seen as a blocking force to prevent the British from capturing the rest of Libya without a fight. The wild card was General Rommel, the commander, who had been trained in infiltration tactics in the Great War, and who had experience as a commander of mechanized warfare in May 1940. He was not content with simply being a blocking force. As was his style, he made a personal reconnaissance of the area that was lightly defended and decided to see if he could panic the British and cause them to withdraw. They did panic and withdraw. In the process, Rommel very nearly took Tobruk, the former Italian fortified position and port. He managed to destabilize the British position which had been left poorly defended. This is in part based on Vol.II of the Australian Official History.