Daily Archives: February 23, 2011

At least half of Libya’s oil production has been shut down in the wake of the violence wracking the country, industry executives estimate.

The continuing disruption in the country, the world’s 12th largest exporter of crude, drove oil prices to a fresh 2½-year peak on Wednesday. Brent oil futures jumped 3.7 per cent to hit $110 a barrel for the first time since before the collapse of Lehman Brothers. The benchmark has risen 7.7 per cent since Monday.

Apart from the prospect of $220 a barrel…

Much discussion on Wednesday of whether Opec could pump more oil from the Arabian peninsula to make up for Libya going offline — so we thought these pointers from Barclays Capital’s Amrita Sen might help:

Kiran Stacey

As the big guns of the oil industry gather in London this week for International Petroleum week, talk has been largely of two things: the effect of Middle East unrest on the oil price and how to improve its reputation, especially after Macondo.

I have just sat through a session entitled: “Restoring the industry’s licence to operate in the face of increasing public and political scrutiny”.

In it, Andrew Griffin, CEO of a PR company called Regester Larkin, explained how the Macondo spill showed that the oil industry needed to do more to explain its importance to the public. This, he said, would help protect companies’ reputations in the case of an accident or other negative event.

Kiran Stacey

As the oil price continues to surge, hitting $109 a barrel, the oil price movement for 2011 has begun to look very much like that in 2008, when the price ended up hitting $145, and became a contributing factor to the slump.

But Leo Drollas, chief economist at the Centre for Global Energy Studies, thinks it won’t, even though there are many similarities with the situation in 2008, including high oil demand.

FT Energy Source

- Libyan chaos threatens to spark oil crisis – FT

- Oil hits $109 a barrel on fears of more unrest – The Times (£)

- Opec ready to raise oil output – FT

- IEA may tap oil stockpiles – WSJ (£)

- Libya’s impact on oil – FT

- All eyes on Bahrain as Gulf tremors frighten oil markets – The Telegraph

- Prepare now for a Saudi oil price shock – Michael Levi, FT

- Mideast unrest shows need for alternative fuels: Navy secretary – Reuters

- Goldman sees WTI-Brent spread narrowing to $7 – Bloomberg

- BP to sell ageing North Sea assets – FT

- BP’s Eastern march of uncertainty – WSJ (£)

- BP rejig could embrace a demerger – FT Lombard

- Rosneft chief takes aim at TNK-BP action – The Times (£)

- Drax raises biomass project hopes – FT

- BHP looks to diversify commodities exposure – FT

- Icahn, Seneca, to reboot Dynegy – WSJ (£)

- Holly agrees to merger with Frontier – FT

- Billionaire Slim enters Colombian oil market – Bloomberg

- Profits rise at Hargreaves services – FT

- A stopgap for climate change – NY Times Green blog

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