Oil prices up another $2 so far today. At this rate, it won't take long to crack $100 in the near future.
SAN FRANCISCO (MarketWatch) — Crude-oil futures breezed past $97 a barrel as New York floor trade opened Wednesday, buoyed by concerns that civil strife roiling Libya and antigovernment protests in other parts of the Mideast and North Africa could result in the disruption of oil supplies.
Brent crude, the benchmark European oil contract, also picked up steam as the New York floor session got into full swing. Brent for April delivery advanced $3.7, or 3.5%, to $109.48 a barrel on the ICE Futures exchange.
“Increasing unrest in North Africa and the Mideast has been a key driver of the latest spike,” said Shane Oliver, chief economist at AMP Capital Investors.
Attention has focused on oil-rich Libya in recent days, with leader Col. Moammar Gadhafi refusing to relinquish power and clashes reportedly leaving at least 300 people dead.
Anti-Gadhafi protesters in Tobruk and Benghazi said they had taken control of the eastern Libyan cities. Some Army personnel there had joined with the anti-Gadhafi movement and were working alongside the protesters, according to reports.
In a statement late Tuesday, the United Nations Security Council “condemned the violence and use of force against civilians, deplored the repression against peaceful demonstrators and expressed deep regret at the deaths of hundreds of civilians.”
The council urged an immediate end to the violence and called on Libya to address the legitimate demands of its population.
Libya holds about 44 billion barrels of oil reserves, the largest in Africa.
The Organization of Petroleum Exporting Countries and the International Energy Agency indicated Tuesday that they would tap their stockpiles if the situation deteriorates further.
“OPEC could easily cope with Libya’s total absence from the market, given the spare production capacities of 5 million to 6 million barrels a day and Libya’s current daily output of 1.6 million barrels,” noted strategists at Commerzbank Corporates & Markets.
“It will only get critical if the unrest spills over to other major oil producers such as Algeria or countries in the Gulf region,” they added.
http://www.marketwatch.com/story/oil...est-2011-02-23