EghtesadOnline: Oil prices rose to their highest in more than week on Monday after two large crude production bases in Libya began shutting down amid a military blockade, setting the stage for crude flows from the OPEC member to be cut to a trickle.
Brent crude futures were up by 74 cents, or 1.1%, to $65.59, having earlier reached $66.00 a barrel, the highest since January 9. The West Texas Intermediate contract was up by 58 cents, or 1%, at $59.12 a barrel, after rising to $59.73, the highest since Jan. 10, CNBC reported.
In the latest development in a long-running conflict in Libya, where two rival factions have claimed the right to rule the country for more than five years, the National Oil Corporation on Sunday said two big oilfields in the southwest had begun shutting down after forces loyal to the Libyan National Army closed a pipeline, according to Financial Tribune.
Oil prices had fallen back in the last two weeks. After the outbreak of hostilities between the United States and Iran at the beginning of the year triggered a jump, both sides took steps to pull back from conflict, calming the market’s mood.
If exports are halted for any sustained period, tanks for storage will fill within days and production will slow to 72,000 barrels per day, an NOC spokesman said. Libya has been producing around 1.2 million bpd recently.
Also on Sunday, foreign countries agreed at a summit in Berlin on Sunday to shore up a shaky truce in Libya, even as the talks were overshadowed by the latest blockade.