Oil prices mixed after Gadhafi’s death
NEW YORK—Oil markets felt little impact Thursday from the death of Libyan strongman Moammar Gadhafi, though it could lead to an earlier-than-expected full restoration of Libya’s oil exports.
New York’s main contract, West Texas Intermediate crude for delivery in November, fell 81 cents to $85.30 a barrel.
In London, Brent North Sea crude for December pushed $1.38 higher to finish at $109.76 on the Intercontinental Exchange.
The New York contract, on its final day, “expired at its lowest price in a week as oil prices fall back on concerns that a European debt agreement may be delayed,” said BMO Capital Markets.
“There is also speculation that Gadhafi’s demise could accelerate the return of Libyan production.”
Gadhafi’s death “actually means little for today’s oil price, but it does remove one of a series of risk factors to a sustained ramp-up in Libyan production,” JPMorgan analyst Lawrence Eagles said.
Libya produced about 1.4 million barrels per day of mostly high-value light sweet crude before the rebellion against Gadhafi broke out at the start of 2011.
Around 85 percent of Libyan output was exported to Europe, and its disappearance contributed to the surge in Brent crude from the North Sea, in comparison to New York-traded WTI.
OPEC sees member Libya restoring production to one million barrels per day within six months, then attaining pre-conflict levels by the end of 2012.
But analysts at Barclays Bank warned that “serious security challenges persist in Libya that could hinder efforts to restore Libyan production fully.”
