Oil prices rise on Libya supply strains

LONDON, Aug 13, 2013 (AFP)

World oil prices rose on Tuesday on reports of fresh supply disruptions in crude exporter Libya, analysts said.

Brent North Sea crude for delivery in September climbed 69 cents to stand at $109.66 a barrel in London midday deals.

New York’s main contract, West Texas Intermediate for September, grew 25 cents to $106.36 a barrel.

“The supply outages in Libya are lending buoyancy,” said Commerzbank analyst Carsten Fritsch.

“The situation in Libya remains fraught. After just a few hours, the country’s two biggest export terminals in Es Sider and Ras Lanuf had to be shut down again yesterday when new strikes (by workers) flared up,” he added.

Libyan oil exports had earlier this month plunged by more than 70 percent after protesters, including policemen and border guards, forced terminals to shut over demands for back pay.

The Libyan protests have exacerbated investors’ concerns about a disruption to global oil supply, amid fears that Egypt’s ongoing political crisis could force a closure of the Suez Canal and Sumed Pipeline.

Meanwhile militants on Tuesday bombed a major pipeline carrying oil from northern Iraq to Turkey, stopping exports, a senior official from the North Oil Company official said.

Iraq is dependent on oil exports for the lion’s share of its government income, and is seeking to dramatically ramp up its sales in the coming years to fund the reconstruction of its battered infrastructure.

Oil traders were looking ahead to official retail sales data due Tuesday from the United States.

US figures have showed that China is set to overtake the United States as the world’s largest net oil importer from October owing to rising Chinese demand and increased US production.

China is already the biggest energy user in the world and the second-largest oil consumer after the United States.

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