A crucial benchmark in the price of crude oil reached a three-year high overnight as repercussions from the civil war in Libya were felt by traders around the world. In London, Brent crude spiked to $108 in after-hours trading as foreign energy producers in Libya began curtailing production and evacuating non-essential personnel and families.
The French energy company Total, Italy’s Eni, the largest energy producer in Libya, Norway’s Statoil, and Repsol of Spain have all shuttered offices. Some of the foreign energy companies are already suspending drilling operations, and production has tapered off by as much as 25 percent.
Libya typically produces 1.6 million barrels of oil per day. Already, that number has dwindled by as much as 300,000 to 400,000 barrels per day. If the disruption continues for long, analysts believe the loss of foreign expertise could prove detrimental to the oil-rich nation.
According to The New York Times, Libya ranks No. 7 among the OPEC nation’s, with 4.4 percent of the cartel’s crude oil reserves. The country ranks third in overall production in Africa and has the continent’s largest proven reserves with 44 billion barrels. The country typically accounts for 2 percent of global oil production.
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