Oil near $105 as Libyan rebels reclaim ports

2011-03-28 07:47

Singapore – Oil prices slipped to near $105 a barrel in Asia today as Libyan rebels retook control of two key port towns and said they would restart crude exports within weeks.

Benchmark crude for May delivery was down 34c to $105.06 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 20c to settle at $105.40 on Friday.

In London, Brent crude was down 5c at $115.54 a barrel on the ICE futures exchange.

Rebels recaptured oil complexes in the coastal cities of Ras Lanouf and Brega as strikes by coalition fighter jets and missiles pushed back forces loyal to Libyan leader Muammar Gaddafi. Rebels have vowed to quickly restart Libya’s 1.6 million barrels per day of crude output, but many important foreign oil workers have fled the country and continued fighting makes tanker shipments risky.

Investors are also closely watching escalating protests in Syria and Yemen, the latest unrest in a wave of uprisings this year that unseated leaders from power in Tunisia and Egypt, and sparked violent demonstrations throughout North Africa and the Middle East.

Some analysts expect strong global crude demand to continue this year, keeping oil above $100.

Barclays Capital raised its 2011 average crude price forecast to $106 from $91.

“The positive demand shock of 2010 has continued into 2011,” Barclays said.

“Chinese oil demand has shown no signs of easing and the US economy continues to grow and oil demand remains healthy, even in the face of retail prices approaching record levels.”

In other Nymex trading for April contracts, heating oil fell 0.2c to $3.05 a gallon and gasoline was steady at $3.04 a gallon. Natural gas added 4.8c to $4.45 per 1 000 cubic feet.

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