Brent’s value increased today thanks to a Libyan supply outage at a time of the expected increase in winter oil demand.
Brent crude increased by five cents to $111.36 a barrel, while US crude dropped by 16 cents at $92.14, reported Reuters.
Brent crude gained after the latest disruptions in Libya, where protests at oil ports have reduced oil supplies from the country by 20% compared to previous levels.
Militias, tribesman and ethnic minorities have blocked oil fields and ports to make demands, drying up the main cash flow for the budget.
Libyan Prime Minister Ali Zeidan said the government will be unable to pay public salaries and might have to seek loans if armed militias put blockades at oil fields and ports, choking crude shipments.
In near future oil prices are expected climb as The Libyan Government may strike a deal with the militias and accept their demands, as nearly all the country’s revenue comes from oil exports. Once the agreement is signed supplies could increase by about 1mmbpd.
In addition to Libyan exports, Iranian supplies would also increase if Tehran follows through on commitments reached in a breakthrough deal with world powers regarding its nuclear programme.
Image: Brent futures were at more than $111 a barrel on Thursday. Photo courtesy of freedigitalphotos.net.