Oil Price: Libya Protests
February 21, 2011 by staff
Oil Price: Libya Protests, Oil prices have jumped 6% on Monday as violent protests spread to Libya, raising the possibility that oil supplies from the OPEC nation that could be disrupted. Oil consuming nations have emergency reserves, they can serve to stabilize the markets in case of violence in Libya or elsewhere in the Middle East and escalating production touts, officials said Monday. But international leaders andanlysts meeting in London have been nervously watching developments in the oil-rich region, worried about the strong earthquake unrest is to give crude oil prices. Oil prices jumped Monday as the crisis in Libya, where Muammar Gaddafi’s son, Seif al-Islam Gaddafi, warned Sunday that the demonstrators, they risk triggering a civil war in which the oil wealth of Libya ” will be burned. ” By afternoon in Europe, light, sweet crude for March delivery rose 5.05 to 91.25 and and a barrel of 42 gallons. The April contract raised more than $ 5 to $ 94.84. A barrel of 42 gallons.
(CP) – Oil prices jumped more than 3 and a barrel Monday amid concerns that investors violent protests spread to Libya could disrupt crude supplies from the OPEC nation.
By early afternoon in Europe, benchmark crude for delivery in March was up $ 3.10 to 89.30 and U.S. a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 16 cents to $ 86.20 and Friday.
U.S. markets, including floor trading of Nymex, were closed Monday for Presidents Day.
In London, Brent crude for April delivery gained 1.73 to 104.25 and the barrel and the ICE Futures exchange.
The difference between Nymex and Brent contracts dropped slightly but remained well above normal levels of a few dollars a barrel. Brent is considered more sensitive to potential disruptions in oil supplies from the Middle East, while big U.S. crude oil inventories are one of the reasons why the quotes below Nymex.
Sunday, Seif al-Islam Gaddafi, son of Libyan leader Muammar Gaddafi, has warned the protesters that they might ignite a civil war in which the oil wealth of Libya “will be burned.” Libya exports at least 1 million barrels of crude per day.
“Compared to Tunisia (minor crude exporter) or Egypt (not an exporter, but a country of transit), instability in Libya is a major concern for the oil industry,” saidanlysts at JBC Energy in Vienna.
Earlier Sunday, anti-government protests spread to the Libyan capital of Tripoli and protesters have seized the military bases and weapons. In the eastern city of Benghazi, about 60 people were killed, while more than 200 deaths since the trouble started seven days ago.
Oil traders are also closely monitored the recent protests in Iran, which is the second largest exporter of crude Organization of Petroleum Exporting Countries after Saudi Arabia.
“Concerns about the market beyond Libya,” said Victor Shum, energyanlyst with Purvin & Gertz in Singapore. “It’s unlikely we’ll see any significant disruption of oil from the Middle East or North Africa, but the spread of these disorders has raised anxieties.”
Someanlysts are worried about oil prices will undermine a fragile economic recovery in developed countries. For every $ 1 increase in the price of a gallon of gasoline, consumer spending in the United States decreased by about 120 billion, “said Gerard Minack, an economist at Morgan Stanley.
“Energy is more important to consumers in the developed world than food,” Minack said. “Therefore, further increases in oil prices, if they occur, would likely be perceived as a threat to growth.”
In Nymex trading in contracts for March, heating oil rose 5.22 cents to 2.7651 a gallon and gasoline gained 3.83 cents to 2.5896 a gallon. Natural gas lost 0.9 cents to 3.867 per 1,000 cubic feet.
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