Last Updated on Tuesday, 30 November 1999 05:00 Wednesday, 24 August 2011 11:05
LONDON (AFP) - Oil prices rose on Tuesday as traders monitored the crisis in oil-rich Libya, with rebels claiming victory and capturing Moamer Kadhafi s heavily fortified compound.
Also supporting prices was expectations that it could take years before the North African country s oil output was back to pre-revolution levels. Brent North Sea crude for October delivery rose $1. 25 cents to $109. 61 a barrel in late afternoon London deals. New York s main contract, West Texas Intermediate (WTI) light sweet crude for October delivery gained $1. 79 to $86. 21.
Brent oil sank Monday on the prospects of a recovery in Libyan crude output as a rebel advance deep into Tripoli left leader Kadhafi facing the end-game after six months of violent unrest. After yesterday s reaction to what seemed like an imminent conclusion to the Kadhafi regime in Libya, Brent oil has rebounded to retest the $109-per-barrel level on Tuesday, following reports that it might take possibly several years for full oil production to resume, said Sucden analyst Myrto Sokou. Brent is more affected than WTI by the situation in Libya since oil from the North Sea as well as from Libya serve the European markets.
Around 85 percent of Libyan oil output was exported to Europe until the revolt disrupted the country s production six months ago. Rebel fighters captured Kadhafi s Bab al-Aziziya compound and headquarters in Tripoli on Tuesday after a day of fierce fighting, an AFP correspondent witnessed.
The defenders had fled, and there was no immediate word on the whereabouts of Kadhafi or his family after the insurgents breached the defences as part of a massive assault that began in the morning.
On Tuesday morning, Kadhafi s son Seif al-Islam, who had reportedly been under arrest, made a surprise appearance in Tripoli and announced that his father and family were still in the capital.
Meanwhile, analysts cautioned it could take Libya two years to restore oil production to pre-revolt levels and that disputes over who would hold power in any post-Kadhafi regime could also delay rebuilding the economy.
The lack of any strong institutions was another factor that could impede the country s road back to resuming full-scale crude production, they said.
I don t think they can resume production immediately. It might take place in three or four months but to go back to the level they used to produce, it may take two years, Shukri Ghanem, the exiled former Libyan oil minister, told energy news specialist Platts on Monday.
Before the uprising began in February, Libya produced about 1. 6 million barrels per day and exported 1. 3 million, much of it light crude highly valued by Europe s refiners, which have struggled to replace it.
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