Crude oil prices push higher on Libya supply concerns
2011-02-23 11:19:18
Oil prices have continued to climb in Asian trading, hitting their highest levels since October 2008 after Libyan leader Col Muammar Gaddafi refused to stand down.
There are concerns that the anti-government unrest in Libya will disrupt global oil supplies.
Stock markets in Asia were little changed after dropping on Tuesday.
Investors said they are gauging the impact of Libyan unrest on the global economy and corporate profit growth.
Major shift?
Libya is the world's 12th-largest exporter of oil.
"Global investors are now trying to decide if the Middle East crisis means a major shift of geopolitical balance of power in the region," said Masayuki Kubota of Daiwa SB Investments.
He added that there could be "more instability and possible further oil price rises".
Brent Crude Oil Spot $/barrel
| price | change | % |
|---|---|---|
| 106.46 |
+1.54 |
+1.4 |
In Asian trade, US light sweet crude for April delivery was 2% higher at $95.45 a barrel. On Tuesday, the March contract had jumped almost 9% in value.
Brent crude rose 58 cents to $106.36 a barrel, after going as high as $106.58 earlier.
On Monday, Brent hit a two-and-a-half-year high of $108.70.
"The major underlying fear in the market is that these protests spread in the region to even larger producers like Saudi Arabia," said Andy Lebow, a trader at MF Global in New York.
"While that might not look likely right now, even a hint of real problems there could send prices vertical."
On Tuesday, International Energy Agency chief economist Fatih Birol said oil prices were in the danger zone.
He said they could rise further if turmoil continues in the Middle East and that may slow the recovery from the global economic crisis.
"The global economy is more fragile now than it was in 2008," Mr Barratt said.
"Growth has been driven by stimulus packages and austerity measures. I don't see it being able to absorb a rise to $140 like it did two years ago."
Taking stock
Shares were mixed in early trading across Asia.
Japan's Nikkei 225 index was little changed on Wednesday despite the Ministry of Finance reporting the first trade deficit in almost two years.
Indexes in Singapore, Shanghai and New Zealand were also trading flat. Australia's main S&P/ASX 200 index slid 0.2%. South Korea's Kospi Index rose 0.2%.