Brent crude has dropped today, after Libya restarted production from its oil fields and also because concerns over the Middle East’s crude supply eased, following diplomatic talks with Syria to remove chemical weapons.
Brent crude was down by 17 cents at $108.02, while US oil increased by 32 cents to $105.74, reported Reuters.
Prices were impacted after Libya, which resumed oil production from its western oil fields on Monday, estimated that oil supplies would rise to 400,000 to 450,000 barrels per day (bpd).
The five permanent UN Security Council members, who started talks on a Western-drafted UN Security Council resolution to eliminate Syria’s chemical weapons, was also one of the reasons for the drop in Brent’s value.
Investors, who were concerned that oil supplies from the Middle East might get disturbed if there was any violence (in the form of a military strike on Syria), showed signs of relief as tensions abated.
They, however, remained cautious as they watch out for the US Federal Reserve policy meeting, where a decision on stimulus reduction is expected to be made by the central bank.
Image: Brent dropped following Libya’s oil production. Image courtesy of Victor Habbick.