Share this article

Oil prices have fallen as markets expect Libya’s production to return to normal after the declaration of a force majeure.

According to Reuters, Brent crude futures were down $0.56 at $64.64 per barrel. US West Texas Intermediate (WTI) crude was down $0.35 at $58.19 a barrel.

OANDA market analyst Edward Moya said: “The situation in Libya provided oil prices an early boost but the rally fizzled out as expectations remain that Libya’s oil production will eventually return to normal levels.”

The National Oil Corporation (NOC) of Libya said that forces loyal to military commander Khalifa Haftar closed a pipeline. This forced two oilfields in the southwest region of the country to shut.

Libya’s NOC declared force majeure on crude loadings from the Sharara and El Feel oilfields. Reuters reported this according to a document sent to traders.

Reuters cited an NOC spokesman as saying that storage tanks will fill within days. The spokesman said production will slow to 72,000 barrels per day (bpd) if Libyan exports cease for any length of time.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData

Recently, Libya’s production rate has reached approximately 1.2Mbpd.

Mitsubishi Tokyo oil risk manager Tony Nunan said: “Every time we get a big geopolitical event, the market spikes up but everybody looks at that as a chance of a selling opportunity.”

“We are caught in this ($65 per barrel) trading range. Anything below and OPEC is going to have a tough time balancing their budgets … and anything above, shale (output) will rebound.”