Oil prices climb amid Libya fighting

March 23, 2011 | 08:32

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World oil prices advanced on Tuesday as fighting raged on in Libya, a significant exporter of crude before the current crisis.

photo source: AFP

In New York, crude for April delivery closed at $104 dollars a barrel, up $1.67 at the end of Monday trade.

In London Brent North Sea crude for delivery in May rose 74 cents to $115.70 after falling early in the day on profit-taking, traders said.

The conflict in Libya continued to press the markets, after forcing the shutdown of more than three-quarters of the country's roughly 1.7 million barrels per day production.

Coalition forces kept up the pressure on Moamer Kadhafi's military for a cease-fire, but with little obvious ending in sight.

"Investors are expecting that Libyan oil is not returning to the markets any time soon," said Ong Yi Ling, an investment analyst for Phillip Futures.

Meanwhile the recent spike in oil prices could shave half a percentage point off growth of the world's advanced economies by 2012, according to a study by the Organisation for Economic Cooperation and Development published Tuesday.

It said that if the $25 per barrel increase in prices since the beginning of the year is sustained, "activity could be reduced by about 0.5 percentage points in the OECD area by 2012 and inflation could rise by 0.75 percentage points."

AFP

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