AFP, New York :
Global oil prices dived Friday on the prospect of Libyan oil production ramping up after rebels lifted blockades on shipping terminals.
US benchmark West Texas Intermediate for August plunged $2.10 to close at $100.83 a barrel, its lowest level since May 12.
Brent North Sea for delivery in August slid $2.01 to finish at $106.66 a barrel in London trade. It was the European benchmark futures contract’s lowest close since April 7.
“The petroleum markets are under ongoing selling pressure as traders react to the decline in price by selling more, even in the absence of fresh compelling bearish news,” said Tim Evans of Citi Futures.
Evans pointed to the market’s continued focus on the recovery in Libyan crude oil production.
But he noted that most of the news this week “has just been confirmation that export terminals have reopened and that output is gradually rising as the result of the political cooperation announced more than a week ago.”
Libyan production has been severely limited for a year after rebels blockaded terminals as part of a campaign to restore autonomy in the country’s eastern region.
Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at consultancy firm EY, said oil prices were weighed down by the imminent return of disrupted Libyan exports into a global market already flush with supply.
The ports at Ras Lanuf and Al-Sidra could add about 500,000 barrels of crude per day to global energy markets, analysts say.
Output in Sharara, the site of Libya’s largest oil field, is reaching its maximum production capacity of 340,000 barrels, just days after it reopened following a deal between rebels and the government.
