Brent crude breaches $105/b as Libyan turmoil deepens
London (Platts)--21Feb2011/703 am EST/1203 GMT
ICE Brent crude futures climbed above $105/barrel Monday as the deepening
political unrest in Libya began to affect the country's oil production,
up $2.36/b from Friday's close. US light crude futures on NYMEX surged by
$3.30/b to $89.50/b.
Prices subsequently dropped back, with April Brent trading at $103.38/b
and March WTI at $89.36/b at 1137 GMT, $1.86/b and $3.16/b above Friday's
Earlier Monday, al-Jazeera television reported that crude production at
Libya's Nafoora oil field had stopped because of a strike by workers, hours
after a tribal leader warned that oil exports from the OPEC state would be
halted unless Libyan leader Muammar Qadhafi orders an end to the violent
suppression of nationwide protests.
The oil field is one of the so-called giant fields in the Sirte Basin,
the biggest oil-producing region in the North African country, and is operated
by the Arab Gulf Oil Co.
Article continues below...
Request a free trial of: Oilgram News
Oilgram News brings fast-breaking global petroleum and gas news to your desktop every day. Our extensive global network of correspondents report on supply and demand trends, corporate news, government actions, exploration, technology, and much more.
The expansion of the Nafoora oil field is part of the Libya's plan to
expand its crude oil output capacity by 270,000 b/d by 2013 although that
target was likely to be missed even before the recent troubles.
It was not possible to verify the report independently and current
production from the field was not available.
A tribal leader in northwestern Libya late Sunday warned that oil exports
from the country, which holds Africa's largest crude oil reserves, would be
targeted unless the bloodshed ends. Libya currently exports an estimated 1.3
million b/d of crude oil, mainly to Europe.
BP SUSPENDS DRILLING PLANS
BP has suspended plans to drill for oil and gas at its onshore concession
in Libya's western desert after contractors were evacuated from the country
due to unrest but is still conducting seismic surveys at its offshore license,
a company spokesman said Monday.
"We have two license areas, one deepwater offshore and we are still
doing seismic. That has been unaffected," a BP spokesman said.
"We were making preparations to make onshore drilling in the western
desert. Some contractors have been evacuated so we have suspended drilling,"
he said, adding that BP was in the early stages of exploration.
BP has about 140 staff in Libya, mostly in Tripoli, he added.
"In the early part of this week, we plan to take out families and non
essential staff," he said.
Several other international oil companies operating in Libya said their
operations had not been affected so far by the unrest, which has reportedly
left more than 200 protesters dead, but that they were planning to evacuate
non-essential staff and their families.
A source at Germany's Wintershall, one of the biggest foreign oil
operators in Libya, said upstream operations so far had not been affected by
the wave of violence that has swept through the OPEC state but that he
expected they would be impacted after the evacuations.
Wintershall has been involved in Libya's energy sector since 1958
and is one of the biggest foreign oil producers in the country. It operates
eight onshore fields and has a stake with Total and Libyan state-owned NOC in
the offshore al-Jurf oil field.
Norway's Statoil is evacuating non-Libyan staff and has told its Libyan
staff not to go to the office in Tripoli, which is closing for the time being.
"We have decided to close down the office under the current circumstances
and we have a handful of expats leaving the country," the spokesman said,
adding that some had already left and some were in the process of leaving.
"Our main agenda is to take care of the security of our personnel," he
said. "We are asking our Libyan staff not to come to the office."
Statoil is a partner in two fields in Libya, operated by Total and
A spokesman for Total, which produces 55,000 b/d in Libya, said its
operations had not been affected by the turmoil but would not comment further
or say whether the company planned to evacuate staff.
Austria's OMV also said there had been no impact on its Libyan operations
although it plans to reduce its staff in the country to "business-essential
staff" because of the unrest and to withdraw all other OMV expatriates and
their families. OMV employs 53 people in Libya, including 15 expatriate
OMV entered the Libyan upstream in 1985, and now has interests in 12
exploration and production licenses in the country. Its current oil production
in Libya is 34,000 b/d.
Shell said it had "temporarily relocated the dependents of expatriate
staff outside Libya" and that it continued to monitor the situation in the
--Margaret McQuaile, email@example.com
--Staff reports, firstname.lastname@example.org