Oil climbs higher on Libya conflict

Crude oil rose on Friday, with Brent pushing toward $116 a barrel, as Libyan security forces began a violent crackdown on protesters in Tripoli and clashed with rebels near the major oil terminal of Ras Lanuf. Al Jazeera television also reported that an oil facility at Zueitina, south of Benghazi was damaged and on fire. By 1448 GMT, Brent crude futures for April delivery were up 87 cents to $115.66 a barrel, after earlier touching $116.30. US crude futures for April rose $1.27 cents to $103.18 a barrel. The intraday peak was $103.57, the highest since front-month crude hit $106.91 on Sept. 29, 2008, eclipsing $103.41 reached on Feb. 24. “Tension in the Middle East is like a runaway train,” said Michael Hewson, an analyst at CMC Markets. “Once it starts it’s very difficult to stop. And if there is a danger that it impacts the supply chain, people will understandably get nervous.” Barclays Capital analysts said in a note the chances of a swift resolution in areas of tension had reduced considerably. “Libyan oil is likely to be lost to the market for an extended period, tying up considerable amounts of replacement oil in much longer supply chains, and events in Nigeria, Iraq, Iran and Bahrain are likely to provide a continuing backdrop of headline risks,” they said. Investors and traders have been tracking the civil unrest in North Africa and the Middle East for any sign that Saudi Arabia, OPEC’s leading oil producer, would be affected. Libya’s oil output has fallen to 700,000-750,000 barrels per day (bpd) from normal levels of 1.6 million bpd as most foreign oil workers have taken flight, according to Shokri Ghanem, the head of Libya’s state-owned oil company.