Libyan oil production set to resume amid Mideast tensions
Crude oil enters the fourth quarter with stable quotes. The Israeli army has launched a ground operation in Lebanon. Despite the rising geopolitical risks in the Middle East, oil from Libya may soon return to the markets.
1 October 2024 12:02
A barrel of West Texas Intermediate (WTI) oil for November delivery costs $92.00 CAD on the NYMEX exchange in New York, up 0.15%.
Brent oil on the ICE exchange in London for November delivery is priced at $97.00 CAD per barrel, up 0.13%.
Investors are assessing risks associated with the Middle East after the killing last week of Hezbollah’s terrorist organization leader Hasan Nasrallah by Israel. Currently, the Israeli army has begun ground operations against Hezbollah targets in southern Lebanon. These operations are supported by air and artillery and will be conducted in parallel with fighting in the Gaza Strip and on other fronts.
According to the Beirut government’s estimates, more than a thousand people have been killed in the attacks over two weeks, and over one million Lebanese have had to leave their homes.
More oil may flow from Libya
Meanwhile, more crude oil may reach the fuel markets from Libya after two rival governments in this North African country reached a compromise regarding the central bank's oversight. This had previously caused the suspension or disruption of Libyan oil deliveries.
On Monday, the Libyan parliament approved the appointment of a new central bank governor. The Libyan oil sector is expected to receive an order to resume oil production shortly, with work on this expected to start on Tuesday.
Libya pumps approximately 1.2 million barrels of oil per day under normal conditions. At the end of August, however, this number fell to 450,000 barrels per day after Libya’s “western government” dismissed the central bank governor, angering the “eastern government.”
The central bank of Libya oversees billions of dollars in revenues from the sale of Libyan crude oil.
