A note has come through from Moody’s about oil companies operating in the Middle East, which makes some interesting points.

Its main thrust is that any disruption to supply from Libya, even for major players in the country, will be counteracted by a surge in oil prices.

One reason for that is that Libya taxed these companies at roughly 94 per cent. It has previously been said that one risk to IOCs is that if a new regime comes to power it will inflict more punitive terms on these companies as a populist measure. But realistically, it couldn’t get much more punitive than it already was, at least not without pushing out companies altogether and so stopping that source of revenue for the regime altogether.