Please see Warplanes, Militia Fire on Libyan Protesters; Libya�s U.N. Diplomats Break With Qaddafi, Call Leader "Genocidal War Criminal" for details.
In response to those plane attacks, Libyan diplomats are now asking the US and UN for help. Libya's Deputy Ambassador has asked for a "No-Fly Zone Over Libya"
Oil Companies Prepare for Shutdown
The Financial Times reports Oil groups prepare to close down in Libya
Oil production in Libya is set to drop dramatically as major international companies and sub-contractors evacuate their staff from the north African country, potentially sending oil prices much higher.Oil prices jump as violence spreads in Libya
Crude oil prices shot up on Monday to a fresh 2�-year high above $105 a barrel as traders braced for the impact of political unrest in Libya, the first major oil exporting country to be hit by turmoil in the Middle East. Brent rallied further in after-hours trading, up to $108.70 a barrel.
Given that Libya is the 8th-largest oil-producer in OPEC and the 12th-largest exporter overall, oil futures are flying this evening, while equities are getting hammered.
Oil traders offered conflicting reports about oil loadings at Libyan ports, with some reporting problems at several terminals and refineries and others saying that vessels were still load. Shipbrokers said some vessels were refusing to sail to Libya.
The country is the world�s 12th largest oil exporter and a critical supplier to European countries. Italy, Germany and France imported last year more than half of Libyan oil.
While Libya�s state-owned national oil company controls the majority of the country�s oil production, international oil companies are key for sustaining output through joint ventures. Sub-contractors are also essential to run the fields.
The LA Times reports Oil prices jump as violence spreads in Libya
Unlike Egypt, Tunisia and Bahrain, which are not major oil producers, Libya is a member of the Organization of the Petroleum Exporting Countries, or OPEC. The world's 12th-largest oil exporter, Libya sells most of its 1.8-million-barrel daily output to Europe. Citizen protests and the attempts by the government of Moammar Kadafi to suppress the demonstrations have begun to squeeze the country's oil production.Equity and Futures Markets
A German oil venture is suspending its daily production of 100,000 barrels, while other major oil companies have started to evacuate family members and non-essential employees from Libya. The Nafoora oil field in a prolific part of the country has been shut down by strikes, the Al Jazeera news network reported. A tribal leader in eastern Libya, home to several major fields, also told Al Jazeera that his tribe "would stop oil exports to Western countries" if the regime did not end its violent crackdown.
The regime's spokesman, Kadafi's son Seif Islam, said oil fields could be attacked by "thugs" if the protests go too far.
"We will have a new Libya, new flag, new anthem," he said Sunday in a rambling, often combative speech that was the regime's attempt at compromise. "Or else, be ready to start a civil war and chaos and forget oil and petrol."
On Monday, the U.S. average price for a gallon of regular gasoline rose to $3.171, up from $3.126 a week earlier, according to the AAA Fuel Gauge Report. California's average gasoline price, the highest in the U.S. except for Hawaii and Alaska, rose to $3.561 a gallon, up more than 11 cents from last week's $3.450.
At the downtown Los Angeles Shell station on Olympic Boulevard at Grand Avenue, Mya Ross of Culver City uttered a profanity when she saw the $3.91-a-gallon price, even though her 2005 Toyota Corolla is thrifty in terms of fuel economy. She said she refuses to buy more than a few gallons at a time when prices are this high. "I get so disgusted," said Ross 23. "But it's kind of silly because it just means I stop at more gas stations and get angry all over again."
Libya exports "light sweet," or low-sulfur, crude, which is prized for gasoline production and could be hard to replace, even if the Saudis step in, said Edward Morse, head of commodities research for Credit Suisse.
As one might expect, oil futures are flying, as is gold. Silver was up $1.64 but has given back most of that. The US dollar is firm. Here are a few details as of 3:00 AM Central.
- S&P 500 Futures are -22 points, -1.64%
- Nasdaq 100 Futures are -42 points, -1.77%
- WTIC Crude is up $8.24 to $97.94
- Brent Crude is up $1.97 to $107.71
- Gold is up $12.60 to $1401 having reached as high as $1411
- Silver is up $.60 to $32.90 having reached as high as $34.32
- US$ index is +$.47
This can easily change a great deal by morning.
Brent Crude
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WTI Crude
Equity Sea of Red - Asia
click on any chart for sharper image
Equity Sea of Red - Europe
The European markets were not yet closed when I took that snapshot. All will likely close in the red but Asia got hit harder with the Shanghai stock index off 2.6%.
Live Blog Libya
Here is a link to the Al Jazeera Libya Live Blog
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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